Mango Airlines, the low-cost arm of state-owned South African Airways, has been allowed to resume flights after resolving a dispute with the country’s airport operator over non-payment of fees.
The carrier has agreed with Airports Company South Africa to make a partial payment of what it owes and to commit to finding ways to settle the remaining debt, according to a statement from ACSA on Wednesday. All Mango flights had been suspended earlier after being barred from using the country’s airports, including major hubs in Johannesburg and Cape Town.
The grounding, although brief, was an indication of Mango’s deteriorating financial situation, which was hit by the coronavirus crisis that has hammered the airline industry around the world. The South African government temporarily suspended air travel last year to contain the pandemic, starving Mango of income.
Mango was planning to shut down operations on May 1 to embark on rescuing businesses pending government funding, Business Day reported earlier this week. SAA secured a 10.5 billion rand ($ 735 million) bailout in October, while a long search for private investors in the carrier continues to prove unsuccessful.
SAA has been working on a painstaking process of corporate rescue that began in late 2019 and has yet to resume commercial flights after more than a year. The carrier’s recovery was hampered by South Africa’s isolation from much of the world due to travel bans, which made it nearly impossible to operate a viable international program on a large scale.
Comair Ltd, one of Mango’s two main domestic rivals, was placed under a local form of bankruptcy protection in May last year before resuming flights with the backing of lenders and investors. The company operates the Kulula brand and is British Airways’ local partner of IAG SA.
Other Mango rivals include FlySafair, which has already indicated interest in buying Mango, and smaller airlines SA Airlink and CemAir.
Read: Mango flight reservation warning