Malawi Government has appointed a liquidator for Air Malawi to facilitate speedy settlement of debts and liabilities as part of the companyâ€™s restructuring process.
Privatisation Commission (PC) chief executive officer Jimmy Lipunga disclosed this on Thursday during a briefing to journalists in Malawiâ€™s commercial city, Blantyre.
The liquidator, Lekani Katandula, a partner at audit and business advisory firm Deloitte, will oversee the â€œorderlyâ€ transfer of assets from Air Malawi Limited to a new investment vehicle, Air Malawi (2012) Limited, according to Lipunga. He unveiled 11 companies that have expressed interest to be strategic equity partners.
â€œInvestors will scarcely agree to invest in an entity that is technically insolvent due to indebtedness. The assets of Air Malawi Limited will, therefore, be hived off and will be transferred into Air Malawi (2012) Limited,â€ said Lipunga, flanked by the flag carrierâ€™s CEO Patrick Chilambe and PC director of project investment Charlie Msusa.
He said, accordingly, the strategic equity partners (SEPs) will be invited to recapitalise the new investment vehicle based on a new and viable business operational model and the level of participation within the SEPs should bring the participation of Malawian nationals, both with the SEP and government shareholding, to 51 percent.
Lipunga said in line with the Companies Act, the transfer of assets from Air Malawi Limited to the new investment vehicle can only be achieved through a â€œvoluntary shareholder liquidation frameworkâ€ enshrined in the Companies Act.
He said: â€œIn order to protect the rights of creditors, the law requires that the shareholders in the voluntary liquidation scheme guarantee that the concerned entity is solvent and that it will meet all the liabilities. The government has already made that undertaking and on the strength of a guarantee by government, Air Malawi becomes solvent for purposes of honouring the liabilities.â€
The Malawi Government, through the PC, is seeking a partner to recapitalise Air Malawi and, therefore, taking up an equity interest in the company.
Shortlisted interested partners
Local companies that have been shortlisted include Africa Star Airways Limited, Air Express Limited, Alpha and Omega Duty Free Shops, CDH Limited, Global Airlines, Jetlink Airways Limited and Mpatsa Holdings whereas foreign companies seeking the partnership are Comair Limited, Fly Africa from South Africa, Ethiopian Airlines and Globe Business Network from Botswana.
Working with its transaction advisers, Ernst and Young and other players in government, the PC has begun the process of evaluating the expressions of interest, a process that will culminate into the selection of the preferred bidder.
The deadline for submission of enquiries is December 2 2012 with closing date for submission of final bids on December 15 2012, according to Lipunga. He said a pre-bid conference to allow investors to pose questions to the PC will be held on November 23 2012.