In 2017 Monarch Airlines, a mid-size UK airline, faced an unprecedented financial crisis amid fierce competition and declining ticket prices. KPMG in the UK’s restructuring practice promptly stepped in to assess options available to the airline, which involved developing a contingency plan and running an accelerated sales process principally for the airlines operating and travel businesses, in the event a solvent restructuring could not be achieved. This required navigating a complex array of internal and external conditions affecting the company’s cash flow and stability.
Subsequently, working against a tight deadline of just five weeks, over 100 KPMG professionals were deployed to help Monarch on the day it entered the insolvency process. To reduce the disruption to Monarch’s customers, the Joint Administrators (Partners in the UK firm) aided the repatriation of 86,000 passengers overseas — a target that was achieved thanks to detailed planning and implementation with the UK’s Civil Aviation Authority and third party airline consultants.
The Joint Administrators were also able to maximize value for debt holders by realizing £54 million for the Group’s UK airport take-off and landing slots for secured creditors, but only after initiating an expedited judicial review against the slot coordinator body to obtain the slots we were seeking to realize, which had to be pursued through to the English Court of Appeal to secure a successful outcome. Thus significant value was protected and ultimately realized as part of the Administration.
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