A restructuring plan for Air Austral, including an injection of 55 million euros of fresh money, has been submitted to the European Commission for approval, the airline’s CEO Reunion announced on Friday.
“Our restructuring plan (…) has just been notified to the European Commission by the Interministerial Committee for Industrial Restructuring (CIRI),” Joseph Brema told colleagues in a letter contacted by AFP for a copy.
“The file is currently being investigated by Brussels,” added Mr. Brema, celebrating a “crucial step in the restructuring of our company.”
75% of customers lost between 2020 and 2021
Air Austral saw its finances damaged by the Covid-19 pandemic and accompanying travel restrictions, sometimes stricter in Réunion than in mainland France.
The company lost three quarters of its customers in 2020-2021. At the end of 2021, its debt reached 161 million euros, in addition to the 55 million lent by its shareholders, that is, a total higher than its annual turnover at that time.
The State, for its part, guaranteed several loans and granted rescue aid, which received the green light from the European Commission, which ensures respect for balanced competition, but on condition that the company restructures itself.
Air Austral, which employed 848 people at the end of 2021, is currently 99% owned by a semi-public company, Sematra, which groups in particular the Réunion region (73.5%), the Caisse des dépôts (13.6 %) and the department (11.4%).
According to Brema, who took office in June, the plan sent to Brussels on Friday consists of three parts: a commitment from the Reunion investors to contribute 55 million euros to the capital, a debt restructuring project, which causes with creditors and still needs to be approved by a commercial court, and a commercial strategy.
No merger with Corsair
“I remain, as our current reference shareholder Sematra, optimistic about the follow-up that will be given to it,” said Mr. Brema, saying that he expected “an interpretation of the decision (in) the current (of) the first half of the month of October.
This intervention by investors from Réunion rules out the possibility of a merger between Air Austral and its competitor Corsair, described at the end of 2021 as a possible “option” by the then Minister of Public Accounts Olivier Dussopt.
The company serves various destinations in the Indian Ocean and mainland France from Réunion, and operates ten aircraft: three Boeing 777s, two Boeing 787s and three Airbus A220s for long-haul and two Boeing 737s for medium-haul.
Source: BFM TV
