Zim govt to take over Air Zimbabwe’s debt

2011-10-24 10:36




Johannesburg - The Zimbabwean government is expected to take over Air Zimbabwe’s $140m debt, although with plans to liquidate it over time, the country’s Herald newspaper reported on Monday.

Government would work on cutting the airline’s staff and would seek a strategic partner to buy into the national airline.

According to Transport, Communications and Infrastructural Development Minister Nicholas Goche, Cabinet had agreed to partially dispose of the National Handling Services.

“At its last meeting on Thursday October 20, Cabinet discussed challenges faced by our national airline, Air Zimbabwe Holdings and resolved that, Air Zimbabwe as a strategic government asset and brand, needed to be preserved and supported as a going business concern.

“To this end, government must assume Air Zimbabwe’s current debt and ring fence the same.”

Goche was quoted as saying that once a strategic technical partner was found, proceeds from its equity contribution would be used to liquidate the debt.

He said Cabinet had agreed that there was an urgent need to right size the national airline “into a lean and effective organisation”, and Air Zimbabwe would soon start retrenching some of its workers.

“Efforts to partially dispose of the National Handling Services should be pursued with urgency now in order to secure some financing from within the airline in order to avoid overburdening treasury.

Goche said the airline urgently needed to rejoin the IATA bank settlement plan and the IATA clearing house as well as pay ASCENA and other aviation service providers.

“The airline has been crippled by relentless problems, among them strikes that at some point forced the company to hire planes to take care of its travellers,” the Herald said.

Article source: http://www.news24.com/Africa/Zimbabwe/Zim-govt-to-take-over-Air-Zimbabwes-debt-20111024

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