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Fly Modern Ark Uncovers Mismanagement in Previous LAM Administration

Fly Modern Ark Uncovers Mismanagement in Previous LAM Administration

The South African company appointed by the Mozambican government to manage LAM said this Thursday, 14 September, that it had found situations of “corruption” at the state-owned airline, the supply of services above market value and others without contracts, holding the directors responsible.

In a meeting with journalists in Maputo yesterday, the executive director of South Africa’s Fly Modern Ark (FMA), Theunis Crous, said that the former managers of Mozambique Airlines (LAM) “ran the company as they wanted”, refusing to reveal whether or not these cases had been reported to the competent authorities, such as the Attorney General’s Office (PGR).

Theunis Crous revealed, however, that the FMA is preparing an “exhaustive” report on these practices and that some of these directors remain in the company and have shown “resistance to change”. The source even described some of these people as having “brought the company down”.

In April, severe financial difficulties led the government to place the Mozambican flag carrier under the management of the FMA.

Among other situations revealed by Theunis Crous is an alleged increase in remuneration decided by the then board of directors, for the directors themselves, approved last January, of 100,000 meticais per month, “when the government was looking for a solution for the management” of LAM.

“We stopped this immediately,” he said, guaranteeing that these directors were asked to return the payments they had received from January to May.

The manager added that they found cases of aircraft being chartered for much more than the market rate, services provided to LAM that, in addition to high prices, lacked quality, such as catering, and others paid for without invoices or contracts.

“When we arrived, a Boeing had been in Johannesburg for seven months undergoing repairs that should have been done in 30 days,” he said, demanding responsibility but guaranteeing that LAM is viable.

“The company’s greatest asset is the loyalty of Mozambicans to the LAM brand who, despite the problems, always come back,” admitted Theunis Crous.

“In South Africa, companies in the same [financial] situation as LAM have all been closed down. We have an opportunity here,” he said, adding that he believed the airline could be an “important player” in the region.

The FMA previously revealed that LAM had reduced its debt by 61.6 million dollars since April, compared to the 300 million dollars recognised at the time.

Meanwhile, under South African management, the company recorded a 24 per cent increase in the number of passengers carried, to more than 56,000, and increased flight revenue by 10 per cent, to 671 million meticais.

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