Velvet Sky liquidation application postponed

2012-02-24 12:43

Low-cost airline Velvet Sky, which allegedly owes BP Southern more than R29 million, was given until March 5 to respond to BP’s application to provisionally liquidate the airline.

In the Pietermaritzburg High Court today, BP’s counsel Gerrie Roberts SC, said Velvet Sky had breached its undertaking to pay arrears by February 17 and had not kept up to date with current payments for aviation fuel.

“Velvet Sky has often delayed paying what was due to BP,” he said.

He said the low-cost airline had known two days ago that BP would launch a provisional liquidation application on Friday, but had not responded.

Farouk Moosa, for Velvet Sky, said negotiations were taking place and denied allegations that the pilots had not been paid.

“Payments to staff are up to date,” Moosa said.

Judge Johann Ploos van Amstel said that while liquidation applications were usually urgent, he did not envisage problems should Velvet Sky be given until March 5 to respond, and adjourned the matter to March 7.

BP’s attorney Thulani Mciwa said in court papers that in view of Velvet Sky’s obvious credit difficulties it would not be able to obtain aviation fuel from any major fuel companies in South Africa.

He had heard that Velvet Sky was living from-hand-to-mouth by using credit cards to buy small amounts of fuel from other sources.

However, it was not possible to operate its fleet continuously without the proper fuel supply.

Mciwa said the court should ensure that no creditors were unfairly preferred and that Velvet Sky’s assets should be preserved as soon as possible.

The airline drew attention earlier this week when it experienced flight delays on Wednesday and all flights were cancelled yesterday.

Velvet Sky spokesperson Gary Webb said there was a dispute with a service provider, as the airline was in the process of changing service providers, and that this was not concluded in time to operate.

After delays this morning, flights were scheduled to start around 1pm.

The broad-based black economic empowerment company is based in Durban and flies between that city, Johannesburg, and Cape Town.

Join the conversation!

24.com encourages commentary submitted via MyNews24. Contributions of 200 words or more will be considered for publication.

We reserve editorial discretion to decide what will be published.
Read our comments policy for guidelines on contributions.

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
0 comments
Comments have been closed for this article.

Inside News24

 
/News

Book flights

Compare, Book, Fly

Traffic Alerts
There are new stories on the homepage. Click here to see them.
 
English
Afrikaans
isiZulu

Hello 

Create Profile

Creating your profile will enable you to submit photos and stories to get published on News24.


Please provide a username for your profile page:

This username must be unique, cannot be edited and will be used in the URL to your profile page across the entire 24.com network.

Settings

Location Settings

News24 allows you to edit the display of certain components based on a location. If you wish to personalise the page based on your preferences, please select a location for each component and click "Submit" in order for the changes to take affect.




Facebook Sign-In

Hi News addict,

Join the News24 Community to be involved in breaking the news.

Log in with Facebook to comment and personalise news, weather and listings.