Granting the order sought by the National Airways Workers Union and Air Transport Union, the High Court appointed chartered accountant Shepherd Chimutanda provisional manager of the carrier
Zimbabwe's High Court has placed the financially troubled Air Zimbabwe under judicial management in response to an application filed by the airline’s workers demanding the payment of unpaid compensation of US$35 million going back to 2009.
In granting the order sought by the National Airways Workers Union and Air Transport Union, representing almost all Air Zimbabwe employees, the High Court appointed chartered accountant Shepherd Chimutanda provisional manager.
The order transferred all powers to Chimutanda and effectively barred the Air Zimbabwe board from running the national airline crippled by US$140 million in debt.
Reached by VOA, Air Zimbabwe Chairman Jonathan Kadzura said he was not aware of the latest development, adding he was busy working on his farm.
Air Zimbabwe General Manager Innocent Mavhunga recently wrote to President Robert Mugabe to acknowledge that the airline is in trouble, but the president has not responded to Mavhunga’s request for yet another financial bailout.
Business law expert Kucaca Phulu said creditors including workers have a right to file a court application for a struggling firm to be placed under judicial management if it is failing to pay its debts and is not likely to be able to do so.
Independent economist Eric Bloch said placing Air Zimbabwe under judicial management seems likely to lead to its liquidation. “We hope that this move will force the government to privatize the loss-making state entity,” Bloch concluded.