Mango Airlines faces major setback in plans to resume flights
The Gauteng High Court has dealt a blow to Mango Airlines’ comeback by ruling that the carrier cannot implement its business rescue plan.
Delivering a major setback to Mango Airlines’ long-delayed return, the Gauteng High Court in Johannesburg ruled that the state-owned low-cost carrier’s business rescue plan cannot go ahead.
The decision raises new doubts about the future of the airline, which has remained grounded since July 2021.
The court issued the ruling after Aviation Co-ordination Services (ACS), a major creditor owed around R2.91 billion, challenged the fairness and feasibility of the rescue strategy proposed by business rescue practitioner Sipho Sono.
ACS, which handles essential aviation services like baggage and cargo screening, argued that the plan severely undervalued creditor compensation, offering just 4.43 cents on the rand.
‘Lacks a solid foundation’
Describing the offer as “negligible, if not nominal,” ACS claimed the plan lacked a solid foundation for long-term financial recovery.
When Mango entered business rescue in 2021, the airline had few tangible assets, with most of its operational capacity dependent on leased aircraft and infrastructure.
The business rescue plan included a controversial compulsory cession clause, which the court has now declared “invalid and of no force and effect.”
In a scathing critique, Judge Fisher rejected Sono’s opposition to the ACS application, describing it as “unmeritorious” and raising further questions about the fragility of the airline’s recovery efforts.
Despite the setback, Sipho Sono has directed his legal team to appeal the judgment in an effort to revive a rescue plan that has been years in development.
However, the path forward remains uncertain, as negotiations with creditors continue and urgent investment remains critical.
Mango’s extended grounding has crippled its operations and impacted numerous employees, customers, and industry stakeholders, underscoring the wider struggles facing South Africa’s aviation sector amid ongoing economic instability.
The full court judgment is available via the Southern African Legal Information Institute (SAFLII).