The government of Namibia has confirmed it paid out USD 107 Million to global leasing giant castlelake after it guaranteed the lease of 2 Airbus A330s to Air Namibia. The settlement reportedly came after close to a year of negotiations
Air Namibia ceased operations in February 2021 after 75 years in service
According to the ministry of public enterprises, “On 25 August 2019 Cabinet resolved that the Ministry of Public Enterprises be mandated to appoint a commercial lawyer and a consultant to advise Government on renegotiating favourable terms to terminate the A330 lease agreements and settle the Government Guarantee.”
A combination of Namibian and Uk based legal expertise has cost the government close to USD 335,000 the Namibian Economist reports. However, government views this as a worthwhile investment considering the total savings from the negotiations will rise to USD 67 Million
“This was an intense and extremely complicated negotiation process that went on non-stop for ten exhausting months. I believe that we were successful when one considers the baseline from where we started, the fact that the lessor had grounds to call on the guarantee resulting in a US$154 million (minimum) immediate payment, and the risk mitigation measures built into the agreements. I further believe that the cost of around N$5 million spent on professionals to provide the required technical assistance represents incredibly good value and was money well spent considering the fact that we are saving Treasury close to N$1 billion that can now be redirected to other important priorities. The funds were duly transferred on 30 July 2021,” said the Minister of Public Enterprises in a statement
According to Ch-aviation, at the time of its collapse, Air Namibia’s fleet consisted four Airbus A319-100s (of which two are owned and two are leased from Deucalion Aviation Funds), two Airbus A330-200s (both leased from Castlelake), four Embraer-135ERs (leased from HOP), and one inactive Boeing 737-500 (owned).
