ARC NEWS
PAL targets 3 September for Chapter 11 filing
September 02, 2021
Philippine Airlines is hoping to make a filing for Chapter 11 bankruptcy on 3 September (New York time). An email sent to lessors at the end of August, states that while there are "still some logistical and other processes to be completed with the local banks and shareholders in the next day or two", the airline is "anticipating" to make a filing on that date. It adds that its lawyers Norton Rose Fulbright will be "reaching out" to lessors and their lawyers "once this is confirmed to notify everyone and ask for the release of signature pages". "We wanted to give this heads up to keep you appraised as we have undertaken to do," it states. It was reported on 1 September that PAL had managed to find a replacement for the $75 million in debtor-in-possession (DIP) financing it lost when the bank that was going to provide it pulled out. Another local bank in the Philippines has now agreed to provide that portion of the financing, out of a total of $505 million. The end-August email confirms this, although it does not name the bank, stating: "We appear to have now overcome the main obstacle that was preventing the filing, namely the availability of the last $75 million of funding for the DIP A tranche." The airline has been in discussions with its lessors about a potential bankruptcy protection filing since last year. Alongside its lawyers, it is being advised by restructuring specialist Seabury Capital. PAL and its advisors have previously provided projections for when it expected to file for Chapter 11, only to let those dates slip and revise the filing to a later timeframe. As it is attempting a pre-arranged filing, it requires consent of a certain portion of creditors ahead of the filing. Given these previous delays, people with a stake in the process are unsure whether the airline will file on 3 September, but some feel they have cause for optimism as they understand the company now has most of what it needs to proceed with the filing.



​Kulula to resume Johannesburg-East London service
September 01, 2021
Kulula, the low-cost brand of South Africa's Comair, will resume flights from Johannesburg to East London on 4 September.
The route will be operated twice weekly, the airline says. “The timing could not have been more perfect, as we celebrate tourism month in September,” Kulula’s executive head of sales and marketing Brian Kitchin states.


Rex extends service suspension until October
September 01, 2021
Australia's Regional Express will extend temporary schedule reductions until 10 October, due to lockdowns and border closures in the states of New South Wales and Victoria. A stand-down of about 500 frontline workers will likewise be extended, the operator said today in a disclosure to the Australian Securities Exchange. The Victorian state government is expected to announce further details on lockdown and restrictions today, Rex said. It also cites further extensions to lockdowns for Greater Sydney until the end of September and Regional New South Wales until 10 September. "Given this uncertainty, we are left with no option but to extend the suspension of our domestic services and reduction of our regional services until 10 October 2021 to provide some time for the advanced sale of tickets." Furloughs will also continue until at least 10 October, as "current conditions now deem it necessary". Rex disclosed in August that staff would be stood down from 16 August until 12 September. In today's statement, the company says it remains optimistic that travel demand will be strong post-lockdowns and border closures. "We are committed to ensuring Rex remains agile and ready to respond when flying resumes." The operator released its preliminary results for the financial year (FY) ended 30 June 2021 on 31 August. The report shows that core revenues – from passenger, freight, charter, and other operations, excluding government grants and subsidies – declined by 35% year-on-year to A$169 million ($124 million), though underlying operating loss before tax narrowed to A$18.4 million from a A$27.4 million loss in FY 2020. Rex's executive chairman Lim Kim Hai said in a 31 August statement: "The first half of the FY22 will continue to be dominated by rolling lockdowns and border closures. "It is possible that the second half will be struck by further waves of infection given the experience of other highly vaccinated countries. As such the outlook for the year is highly uncertain."


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