Saturday, January 12, 2013

■ SOUTH AFRICA: 1Time's Jetworx MRO to be taken over by the American Industrial Acquisition Corporation.

JetworxIn another promising development following the proposed acquisition of bankrupt South African LCC 1Time (T6) by LCC fastjet (FN), its sister MRO company, Jetworx, has been acquired by the American Industrial Acquisition Corporation (AIAC), thereby giving hope to its remaining 200 employees. The deal however, is still subject to approval by Jetworx creditors.

Jetworx MRO
Jetworx MRO (Jetworx)
Jetworx is an Approved Aircraft Maintenance Organisation based at Johannesburg's OR Tambo International Airport and specialises in the repair, and Line and Heavy maintenance of the Boeing 737, Boeing 727, McDonnell Douglas DC9 and MD80 series aircraft as well as the Hercules L382.

Prior to its placement into Business Rescue last year, Jetworx employed 400 people but retrenched 200 shortly before August 2012. A once bristling business, its clients have included GECAS, Safair and Aergo Leasing.

Johan Kruger, spokesperson of South African trade union, Solidarity, said that the sales transaction brings hope to Jetworx’s nearly 200 employees who only received part of their salaries during the past month.
"Before being placed in a process of business rescue in August 2012, Jetworx had already retrenched about 200 of its nearly 400 employees. While Jetworx was in business rescue, retrenchments were stopped for the time being. After 1time was placed under preliminary liquidation, Jetworx was however obliged to consider further retrenchments."
Source [Solidarity]

Jetworx is currently still in business rescue and the new business plan for the company will be announced on 15 January. This will be followed by a process in which the creditors of the company must vote if they are in favour of the transaction, similar to that of 1Time and its ongoing negotiations with fastjet.

Head-quartered in New York, the American Industrial Acquisition Corporation (AIAC) is a growing, privately-held industrial group that describes itself as “turnaround industrial development and management, founded on the principle of acquiring under-performing companies and helping those companies to survive and thrive.”

Of potential interest to AIAC is that Jetworx holds FAA (DV5Y819M), EASA (EASA 145.0122) and RSACAA (AMO006) approvals on the aircraft types previously specified, including a number of component overhaul and repair capabilities, which could present a unique opportunity to provide competitively priced aircraft servicing and overhaul as compared to other MROs in the US and Europe.

The (hopefully) good news comes at a difficult time for South Africa's MRO industry. Denel Aviation’s Aero Manpower Group, the MRO division of the South Africa's government-backed Denel Corporation, are to retrench 523 aircraft maintenance specialists as a result of the South African Air Force (SAAF) deciding against renewing its contract with the firm, set to lapse this year.