MK Airlines is grounded
17 / 06 / 2008
MK AIRLINES has been put up for sale, as administrators were called in on 10 June and the airline’s fleet of seven B747-200Fs, three DC-8 freighters and all engines, spares, consumables, land and buildings were advertised for sale (see page 18).
All of the airline’s B747-200Fs have been grounded, causing major problems for the airline’s biggest customer, Panalpina. The Swiss forwarder used MK extensively for services from Europe into Africa, especially in support of oil and gas and perishable trade.
For a number of months chief executive officer, Mike Kruger, has been trying to attract investment and re-financing options to acquire more fuel efficient 747-400F equipment.
The airline said in a statement that: “These talks have taken place in what is clearly a difficult economic climate, during which time the airline – like all others – has had to cut costs and restructure its operations due to extraordinary fuel prices.
“Due to the company’s financial position, the board of directors appointed James Bradney, Andrew Duncan and Michael Oldham of BKL Business Recovery as joint administrators on 10 June, 2008. This was to provide a moratorium to enable discussions to continue with interested parties.”
The airline maintains that services are only temporarily suspended and the airline refuted suggestions that MK’s AOC had been withdrawn and that other operations have been maintained with a view to achieving a rescue of the company.
There is some hope, however, that a rescue package for the airline may be around the corner. “Talks with potential investors have taken far longer than we would have hoped, not least because of this difficult economic climate. Whilst we continue to discuss options with potential new partners, we are working with the administrators to financially restructure the company and find a way of taking the business forward. Those talks are ongoing, and we are all working towards a speedy conclusion and recommencement of flight services. I hope that the administration appointment will be the beginning of a new future for MK Airlines,” said Kruger.
Bradney, from administrators BKL Business Recovery, added that they were “working hard with management and interested parties to achieve a rescue of the company and the preservation of this well regarded airline, together with the jobs of the staff and air crew. We are hopeful that the company can resume flying operations in the short term.”
Duncan told Air Cargo News on 12 June that although he was hopeful an agreement could be concluded, he had to place the airline for sale in case the deal fell through. “The airline cannot resume flying at the moment, as there is insufficient funds in place”.
Elsewhere, the unprecedented fuel prices has caused more casualties as airlines rush to end 747-200F operations.