Air Mauritius (MK, Mauritius) has exited voluntary administration thanks to a MUR12 billion rupee (USD280million) government bailout aimed at giving the company long-term stability as the country re-opens its international borders to fully vaccinated travellers on October 1.
This follows a September 29 watershed meeting during which the bailout in the shape of a loan arrangement was overwhelmingly supported by Air Mauritius’s creditors, the company said in a statement. As previously reported, the loan is likely to be provided through the Mauritius Investment Corporation, belonging to the state-owned Bank of Mauritius.
The airline on October 1 resumes commercial passenger and cargo flights between Mauritius and Paris CDG (France), London Heathrow (UK), Johannesburg O.R. Tambo (South Africa), Mumbai International (India), Antananarivo (Madagascar), and St. Denis de la Réunion (Réunion). Other long-haul destinations like Hong Kong International, Kuala Lumpur International (Malaysia), and Perth International (Australia) will be introduced at a later date. Additional capacity and international routes will be added to meet demand. Domestic services to and from Rodrigues Island will resume in November 2021.
As part of a new structure, the fleet has been consolidated from 15 to nine aircraft. The wide-body fleet now consists of four A350-900s and two A330-900Ns. The remaining three aircraft are ATR72-500s which will service domestic and regional routes.
The restructuring plan or "Deed of Company Arrangement" approved by creditors will see MUR9.5 billion (USD221 million) made available by October 1, 2021, in order to repay creditors, with the remaining MUR2.5 billion (USD58.2 million) being earmarked for operational expenses if and when needed.
According to local news reports, two of the three groups of creditors - consisting of aircraft lessors and hedge funders - voted unanimously for the government bailout, while 80% of the third group of general creditors supported it. In terms of the approved plan, lessors will receive 35% of their claims, hedge funders 60%, and general creditors 50%. Air Mauritius has more than 2,100 creditors owed between MUR166 (USD3.86) and the MUR455.8 million (USD10.6 million) owed to ABSA Bank.
Administrators A. Sattar Hajee Abdoula and Arvindsingh K. Gokhool now have 21 days to implement the rescue plan and - for the time being - will continue to manage the national airline, reports said.
Air Mauritius said the capacitating loan was indicative of the government’s commitment to the airline as a “strategic national asset central to the government’s tourism and investment strategy and [that] provides Mauritius with its own passenger and cargo connectivity to meet market demands”.
