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07.10.2004 Business & Finance

Ghana Airways: Going, Going ......

By Graphic
Ghana Airways: Going, Going ......

... Assets To Be Converted Into Equity ... New airline would not take over Ghana Airways ... Fate of 1,165 staff in Limbo The government is to value and convert the assets of Ghana Airways into equity as its share in a new company due to the winding-up of the nation's distressed airline.

The new company yet to be named, will not take over Ghana Airways but operate it as a new and different entity.

The government, will have 70 per cent shares in the new company with the remaining 30 per cent shares going to Ghana International Airline (GIA). Over the last few months, the government had been engaged in a partnership deal with GIA, a US based consortium, to partner it in the formation of a new airline.

According to a government source, the fate of the staff of Ghana Airways will depend on whether the new company will like to engage them. The source said as part of the official winding up process of Ghana Airways, the government was engaging the services of an independent valuer to value the airlines assets.

The source said the government was following due process and consequences in winding-up the airline and gave the assurance that due process would be followed in the eventual termination of the appointment of the 1,165 staff of the company. The source said a debt committee had been formed by the government to access the actual debt portfolio of Ghana Airways to enable the government to reschedule the debt as a step to winding the company up.

The source who was emphatic that, the new airline would not take over Ghana Airways but would be a different entity on its own, adding that the faith of the staff of Ghana Airways would depend on whether the new company would want to engage the services of Ghana Airways staff.

The source added that the government would follow provisions made in the collective bargaining agreement signed between the staff and the company in the termination processes. The action of the government, the source explained, was backed by company code 1963 ACT 179 and the Official Liquidation Act, 1963 Act 180.

According to the source, a Shareholders Agreement was yet to be signed by both parties, and that the new airline would be operational before the end of this month.

The source added that the airline would be managed by a five-member board of directors of which the government would appoint three members.

The source said an Initial Management Team of four managers would be appointed by GIA to effectively manage the affairs of the airline. The source went further to state that as part of provisions outlined in the agreement, in the case of any eventualities, the agreement between the two partners would be governed by and construde in accordance with laws of Ghana as to all matters including validity, construction and enforcements “provided, however, that the conflict of laws rule shall not apply”.

As to whether the new airline will fly the national flag and use the name Ghana Airways, the source was positive about the flag but said the company would have to have a new identity from the old airline. The source added that the new airline would also fly all the routes that the old airline was flying including its sub-regional routes.

In a related development, two members of GIA who would form part of the initial management team of the new airline arrived in the country yesterday. The two, Messrs Ralph Atkins, Board Member and retired Chairman of Skywest Airlines, and Albert Vitale, Vice-President of World Transport Group, all in Utah, as part of their visit would secure an Airline Carrier License (ACL) and an Airline Operations Certificate (AOC) for the new airline.

They would also formally, present their business proposal plans on October 31, to government which would be discussed extensively. The outcome of the discussion would inform the commencement of actual business for the company. The start of business would then lead to the gradual winding-up of Ghana Airways.

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