The Windhoek High Court on Friday placed embattled national airline, Air Namibia, under provisional liquidation. 

This follows an application by the Namibia Airports Company (NAC) for compulsory liquidation. 

Windhoek High Court acting Judge Kobus Miller issued an order to show cause to allow interested parties to give reasons why Air Namibia should not be liquidated and placed in the hands of the Master of the High Court on or before 26 March.  According to an affidavit by NAC CEO Bisey /Uirab, the airports company, as well as Challenge Air, should receive preference over other creditors in the winding-up process.  He further said the airline owes NAC close to N$714 million for aeronautical services, ground handling service and rental at various aerodromes across Namibia. 

According to /Uirab, Belgian liquidators of Challenge Air are in a position to gobble up all of the proceeds of a sale in execution of Air Namibia’s assets should the airline be allowed to go down the road of voluntary liquidation, leaving the rest of its creditors high and dry. 

“Should this court not intervene, whatever funds are available in the accounts of Air Namibia might be attached and paid to an overseas concern – being Challenge Air, who will also then effectively be preferred over other creditors,” Uirab stated.

 According to him, the deputy sheriff of Windhoek has already attached an amount of N$400 000 in a bank account of Air Namibia and that he also attached aircraft belonging to Air Namibia, one of whom is fully paid. 

He further said he was advised by his legal counsel that the effect of a winding-up order will put any sale in execution, thus ensuring any assets attached will become available for the body of creditors. 

He further said if the court does not grant his request for a court-ordered winding up of Air Namibia, Challenge Air will be allowed to schedule a sale in execution of the aircraft and or any other assets it may have attached and will similarly be preferred over other creditors of Air Namibia, such as the NAC, which is yet to institute action, obtain judgment, as well as issue and hand in writs timeously so as to share in the proceeds of the sale of such aircraft or other assets.  “In any event, a forced sale in execution will result in much less being realised for the aircraft, as opposed to a sale by liquidator through public auction and/or private treaty, who will be much better suited and placed to properly advertise the aircraft and other assets of Air Namibia, and possibly selling the business of Air Namibia as a running concern, thus ensuring the best possible return for the benefit of all creditors of Air Namibia,” Uirab stated. 

NAC was represented by Advocate Raymond Heathcote, assisted by Advocate Jesse Schickerling on instructions of Shikongo Law Chambers.

Assets

The Belgian liquidator of defunct Challenge Air has attached movable assets of Air Namibia for failing to pay about N$103.2 million two weeks ago as per agreement reached on 29 January. 

The national airline was due to pay the first instalment of 5.8 million euros (N$103.2 million) two weeks following an out-of-court settlement that was made an order of the court last month. 

The remaining amount of 4 million euros (N$72.3 million) would have been paid in monthly instalments, with the final payment due in January next year, according to the agreement.  

On 20, Anicet Baum, the sole liquidator of Challenge Air, submitted to Windhoek’s deputy sheriff for the airline’s movable properties to be attached and publicly auctioned to raise N$103.2 million that is due for payment.  

The dispute between Air Namibia and Challenge Air started from a leasing and maintenance agreement of a Boeing 767-33 aircraft, dating back to 1998.

- rrouth@nepc.com.na