Step-by-step: How Comair bullied take-over target Metaco into the ground. MUST READ!

It’s many an entrepreneur’s dream to receive an attractive offer to buy his or her business. But this story of how Comair took over Metaco, a company built from scratch into a successful consultancy, before playing a central role in its demise – within a year – serves as a cautionary tale for all small business owners to be very careful about the parties with whom you shake hands. Not only did the Metaco founders watch their creation crumble, but Comair also pulled a number of painful moves – including demanding the first instalment of the purchase price of about R12m back after it allegedly destroyed the business. What follows is the time line of events and a summary of how Comair bought a service provider and then played a peculiar game with the people involved. There is also a flashback to the announcement Comair made just over a year ago when it acquired Metaco. You can also listen to Alec Hogg’s interview with the MD of Metaco Barbara Walsh for more background. – Jackie Cameron

Metaco/Comair acquisition & dispute

Timeline of events

August 2017
  • Metaco formed in 2009 by Barbara Walsh and Danny Tuckwood. Peter Hawkins became a shareholder in 2016.
  • It grew into a successful company offering consultancy and coaching in senior team optimization, executive and leadership effectiveness, strategy and culture alignment.
  • Worked with corporates, state-owned enterprises, SMEs and non-profits.
  • Within 3 years was generating healthy profits, growing significantly year on year.
September 2017
  • Erik Venter (CEO, Comair) discussed with Metaco a potential role within their diversification plan as follows:
  • The establishment of a world-class aviation academy;
  • Continue to provide its services within the Comair Group (and outside the Group). Offered commercially.
  • Metaco had been working with Comair for 2 years.
  • Metaco was considered a good fit and had the skills to lead this development.
November 2017
  • Metaco drafts the concept document for the Comair Board.
  • The document described Metaco’s role in the aviation academy to provide its range of services.
June 2018
  • A business valuation was provided to Comair.
  • Comair Board approves in principle acquisition of Metaco.
  • Due diligence process begins.
July – August 2018
  • Due diligence and negotiation proceed and agreed:
  • Danny Tuckwood, shareholder and director at Metaco would be seconded to Comair to initiate and lead the aviation academy project.
  • Danny to stand down and Comair appointed the following directors to Metaco’s Board: Erik Venter (Chair); Kirsten King (CFO, Comair); Eric Shipalana (HR, Comair); Barbara Walsh (MD, Metaco); Peter Hawkins (Metaco); Justice Magagula (CEO of Alt. Academy joined after appointment)
  • Comair had a majority stake on the Metaco Board.
  • A 3-year senior-level contract was signed to replace Danny at Metaco.
21 August 2018
  • Sale and purchase agreement signed for 100% of Metaco by Comair.
  • The purchase price was R33,534,164.
  • R12.8m paid to Metaco on signature and the balance paid over 6 years from profits on an earn-out basis, once the initial payment had been recovered.
September 2018
  • Danny moved across to Comair, and his replacement commenced work.
November 2018
  • First Metaco Board meeting on 19 November unanimously agrees:
  • 5-year goal of R57m turnover per annum (subsequently extended to R100m when the potential was demonstrated by Barbara Walsh)
  • Strategy for achieving higher sales to grow Comair’s non-airline revenue.
  • Non-financial support required from Comair to reach targets was outlined.
  • 2 new employees appointed at Metaco to support extended goals.
  • Wrenelle Stander (current joint CEO) was appointed Executive Director – Airline Operations and Erik Venter as CEO of Comair Ltd, overseeing the wider business.
22 February 2019
  • Concerns raised that Comair’s utilization of Metaco’s services had declined significantly (by over 80%) since November 2018).
  • No notice was given by Comair. Reflection that this was probably a result of airline cost-cutting measures when concern raised at the Metaco Board.
  • It became apparent that Metaco risked posting a loss for the financial year.
  • Work on the establishment of the aviation academy continued.
25 February 2019
  • Metaco Board meeting on 25 February.
  • Concern raised about ongoing drop in Metaco revenue due to cut back on Comair’s non-regulatory training and development
  • To mitigate the loss, and meet 5-year targets, it was agreed that certain milestones planned for 2020 should be brought forward into 2019.
  • These included:
  • New technological and programme product developments;
  • Additional resources to manage new product development; and
  • A senior marketing appointment.
  • Board agrees to plan for future growth externally rather than focus on immediate income.
  • A shareholder loan of R4.05m was requested and approved by Comair, ratified by the Board.
  • Agreed Comair would assist Metaco to secure new opportunities for Metaco’s services.
01 March 2019
  • Justice Magagula was appointed as CEO of the Academy as planned.
  • Danny’s role changed to assist Justice to implement the Academy.
March-April 2019
  • Technology and programme development specialists were contracted by Metaco.
  • A senior marketing expert appointed to start 1 May.
02 May 2019
  • Unexpectedly, Danny secondment to Academy was terminated. When it became clear there was no other role for him at Comair, he moved back to Metaco on 19 May.
21 May 2019
27 May 2019


  • Comair makes it clear for the first time that there was no budget for Metaco’s services and declined to discuss alternative proposals.
29 May 2019
  • Comair issued a SENS notice that Glenn Orsmond and Wrenelle Stander were to be appointed as joint CEOs effect 31 July 2019.
11 June 2019 am
  • Official launch event to showcase Metaco as part of the Comair Group was held.
  • Attracted senior high profile businesses.
  • Erik Venter and Justice Magagula were keynote speakers.
  • The launch showcased:
  • Systemic Leadership Team Coaching as one of Metaco’s strategic focus areas; and
  • The first iteration of the upcoming technological innovations.
  • The launch was exceptionally well received and a new pipeline created.
11 June 2019 pm
  • Metaco Board meeting held.
  • Appointment confirmed of Justice Magagula to the Metaco Board (this was not actioned by Comair)
  • Progress towards the revised strategy was reported, discussed and agreed.
  • Progress on development of new technology and services including the appointment of two specialists on contract;
  • Introduction to new Head of Marketing;
  • The loan amount and draw down to date discussed and ratified.
  • Concerns raised:
  • Metaco not included in Comair’s B-BBEE rating;
  • Continued drop in income from Comair.
Mid-June 2019
  • Comair announced they achieved a B-BBEE rating of Level 2.
  • Told that Metaco was excluded due to white executives which would dilute the score.
25 June 2019
  • Barbara and Danny invited to attend a meeting with new joint CEO designates, Wrenelle Stander and Glenn Orsmond.
26 June 2019
  • Glenn informed these 2 of the 3 Sellers that:
  • Metaco was insolvent and therefore in breach of agreement;
  • That no further funds would be advanced; and
  • The Sellers should immediately repay R1.7m, the amount advanced to date and ensure capitalization of Metaco.
  • No opportunity was given to the Sellers to discuss any of the issues.
  • A Letter of Breach was emailed to the Sellers the same day.

Note: Erik Venter (still CEO) was in the UK at the time. According to the SENS notices issued by Comair on 29 May, Glenn Orsmond would take on the role of Joint CEO from 31 July.

28 June 2019
  • The Sellers dispute the breach.
End June 2019
  • Month-end payments to contractors were not made.
  • Office rental not paid on time, but paid later.
  • Barbara and Danny (SA-based sellers) settle contractors’ bills.
July 2019
  • The SA Sellers suggest meeting to discuss the issue.
  • Comair denies any breach of the agreement.
15 July 2019 (pm)
  • Comair confirms the exercise of the Put Option in the agreement.
  • It places an obligation on Metaco to pay Comair the portion of the purchase price paid, ie 12.8m plus interest
  • Letter signed by GW Orsmond, Chief Executive Officer

(Note: he was not yet Joint CEO. Effective from 31 July only.)

  • No Comair Board resolution to support the divestment as required in their MoI.
17 July 2019
  • Metaco Special Board Meeting convened.
  • Erik Venter (Chair) provided documentation confirming the obligation on Directors to uphold the best interests of the Company.
  • Agreed that a letter be sent to the Comair Board requesting clarity on the intentions of Comair regarding its investment in Metaco.
18 July 2019
  • Comair responds:
  • Comair has no intention of responding to the matters raised; and
  • Comair has instituted the Put option.
24 July 2019
  • Meeting agreed between the 2 SA-based Sellers and Comair with lawyers.
  • No discussion was possible on the merits of Metaco’s position.
  • The issue for Comair was solely terms of the repayment.
  • No agreement reached.
25 July 2019
  • Metaco Board advised that salaries, rent and contractors had not been paid.
  • Eric Shipalana and Justice Magagula advised they were instructed to resign from the Board.
  • Erik Venter informs Comair members on Metaco’s Board that a resolution of the Comair Board had not been obtained to dispose of Metaco.
26 July 2019
  • Comair Board asked to pass resolution to disposal of Metaco via a round-robin process.
  • No arbitration was instigated by Comair prior to the exercise of the Put option despite being required to do so in terms of the agreement.
29 July 2019
  • Comair Board informed by email of context and history leading to this point.
  • The Sellers ask the Comair Board clarify its intentions regarding Metaco. No response received.
31 July 2019
  • Wrenelle Stander and Glenn Orsmond jointly take on the role of CEO.
02 August 2019
  • Kirsten King resignation from Metaco Board.
06 August 2019
  • Comair confirms the Put Option, stating ownership of the company would be transferred back to Metaco.
  • Erik Venter, Eric Shipalana resign from Metaco Board.
  • No SENS announcement made (although it was established that due to the small size of the Company, this was not necessary in terms of JSE regulations).
03 September 2019
  • The SA-based Sellers submit a repudiation of the Sale Agreement to Comair, in order to take back control and enable the effective functioning of the company. Up until that time:
  • Comair had control of the bank account and no invoices or payments were being actioned;
  • Metaco salaries, contractor fees, office rental and other overheads were not paid by Comair;
  • No changes to the CIPC records regarding directors had been made by Comair. This was actioned by the SA-based Sellers.
October 2019
  • The Sellers commenced with action to initiate an arbitration process to resolve the dispute.
  • The Sellers lodged an intention to proceed to arbitration with their Statement of Claim for damages on 17 October 2019.

Metaco’s Board comprised of Eric Venter (CEO of Comair and Chairman of Metaco’s Board); Barbara Walsh, (MD of Metaco); Kirsten King (CFO of Comair); Eric Shipalana (HR Executive, Comair) and Peter Hawkins (Metaco, non-executive director). Comair had a controlling interest on the Metaco Board.

Comair Board Members as at 31 July 2019: Pieter van Hoven (Chairman); Martin Moritz (Deputy Chairman); Glenn Orsmond (Joint CEO); Wrenelle Stander (Joint CEO); Derek Borer (Alternate Director & Company Secretary); Kirsten King (Director Finance); Martin Louw (Director Operations); Naran Maharajh; Carolina Martinoli; Lindsay Ralphs; Rodney Sacks; Njabulo Sithole; Peter Welgemoed.

About Metaco: Metaco is a bespoke consultancy focusing on strategic enablement, organisational design and change-agility with a unique focus at the interface between leadership, strategy and culture. Metaco engages with thought leaders in prominent institutions and environments worldwide to ensure our work is always aligned with the latest thinking and global best practice.

About Barbara Walsh:  Barbara has an MSc in Coaching and Behavioural Change through Henley Business School in the UK, and is registered as a Master HR Practitioner: Learning and Development with the SA Board for People Practices (SABPP). Barbara has an in-depth knowledge of what it takes to plan strategically in the face of an uncertain future, to build relationships at all levels, and partner across stakeholder groups in service of a common purpose.

How aviation giant Comair Airline grounds small business

Metaco summarises the fiasco:

Aviation giant Comair stands accused of reneging on an agreement to buy out a small family-owned business, grinding it into the ground in the process.

Comair operates the British Airways and Kulula brands.

In July 2018 Comair acquired Metaco, a strategic leadership consultancy which had been providing services to Comair for two years, as part of its vision to establish an innovative academy for the global aviation sector.  This was part of Comair’s strategy to diversify income streams for the Group. In addition, Metaco would continue providing team and leadership development at commercial rates to support intensifying change in the Comair Group, and also consult to its external client base.

But, with a sudden about-turn to their plans, Comair sought to disinvest from Metaco within a year, leaving Metaco’s owners with just a shell of the thriving company they previously had. Now Metaco has had to instigate costly arbitration proceedings against Comair to resolve the dispute.

Comair bought 100% of Metaco Holdings (Pty) Ltd for a downpayment of R12.8 million, with the balance of the total purchase price to be paid on an earn-out basis over six years.

Metaco’s proprietary learning methodologies were licenced to Comair, and Metaco’s board was reconstituted to give Comair a controlling stake. Danny Tuckwood, one of the Founding Partners was deployed to Comair to begin establishing the new aviation academy. His position was replaced by contracting a senior executive consultant.

However utilisation of Metaco’s services by Comair was cut back by 80% within six months as part of the airline’s costcutting measures, severely compromising Metaco’s income and profitability. To help mitigate the impact, the Metaco Board agreed to bring forward the development of modern virtual reality learning platforms and focus on building Metaco’s external client base. An internal loan of R4,05 million was confirmed by Comair and ratified by the Metaco Board to fund these developments which had originally been scheduled for implementation in 2020 and had not been budgeted for in 2019.

In May 2019, changes to the strategy for the aviation academy unexpectedly left no role for Tuckwood, who had to return to Metaco, further increasing overhead costs. Erik Venter also resiged as CEO of Comair in May. His successors were named as Glenn Orsmond and Wrenelle Stander, to jointly take over the role from 31 July 2019.

On 26 June a meeting was called by the future CEO’s with the founders of Metaco. To their surprise, instead of learning more about the business, the CEOs immediately alleged that the company was insolvent, and informed the founders that they were as a result in breach of the sale agreement. The loan facility was summarily withdrawn and a demand made for them to personally restore solvency, including reimbursing the R1.7 million drawn down from the loan. Furthermore, Comair required the sellers to capitalise Metaco for a further 12 months.

This demand came just two weeks after a high profile event on 11 June 2019 to officially launch Metaco as part of the Comair Group, at which Venter as a key note speaker, emphasised the significance of Metaco’s acquisition for the Group. At a board meeting on the same day, Metaco reported that good progress was being made in developing the learning technology platforms and implementing the revised strategy.

On 15 July 2019, Orsmond signed a letter as “CEO” demanding the sellers refund R12.8 million, being the initial purchase price, plus interest. This, notwithstanding the fact that Orsmond was only due to take on the role of Joint CEO from 31 July 2019.

“The aggressive and bullying behaviour of Comair was simply appalling, says Metaco Founder and MD, Barbara Walsh. I understand that strategies can change when new management takes over. I would have been open to an amicable exit from Comair, but they were not open to any discussion. Instead, they chose an unethical and confrontational approach.”

Metaco is no longer part of the Comair Group and the founders are now left to pick up the pieces of a once thriving business.

“We consider these actions to be in bad faith,” says Barbara Walsh, “and the process has certainly taken its toll. In the course of one year, our business moved from being a successful world-class consultancy to conveniently being declared insolvent by the new owners. Metaco has never been insolvent and neither did our Board believe we were insolvent.”

Comair’s Board Regulations require that any divestment in a subsidiary be approved by a Board resolution which was not the case at the time. But, the Comair Board has subsequently sanctioned this deficiency in governance.

“This corporate hostility is not congruent with Comair’s stated values of integrity, strong ethics and good corporate governance. As a business Metaco is tiny in comparison with Comair, however our strong and ethical guiding principles inform us as a business, and as people, on our way forward. In spite of the personal risk, we will oppose this strongly as a moral issue. It is our intention that, in standing up against victimisation, we can demonstrate that it is possible to take on giants, and we hope our story will inspire others with the courage to do the same,” says Walsh.

Flashback: Comair acquires leadership development consultancy Metaco

This is the announcement published by Comair on Tuesday, August 21, 2018

Comair has acquired the leadership development consultancy firm, Metaco Holdings (Pty) Ltd, as part of its diversification strategy, Comair CEO Erik Venter announced today.

Venter says the acquisition fits well with its training business that already encompasses courses for pilots, cabin crew, ground operations staff and travel and tourism. “Through our existing client base, we have seen the demand for leadership and team coaching, and Metaco fits this requirement”. “Comair has evolved from operating two airline brands into an aviation group, with operations in aviation training, catering, hospitality and tourism and airport lounges. We are now balancing the capital-intensive airline business with new business units that are more reliant on intellectual capital and have a different revenue cycle and cost base.”

Venter notes that Comair has worked extensively with Metaco over the past two years.

Metaco’s MD Barbara Walsh says “Over the past nine years our purposeful vision for Metaco has been the development of cohesive, strategic leadership teams, that connect effectively across their range of stakeholders and thrive in the ever-changing contexts of business today. By extension, successful companies assist South Africa to thrive. This is very important to us. “Metaco’s systemic focus and strong track record for delivering transformative results in private and public-sector organisations have been our success. We’re excited at the significant opportunities that we are identifying as part of the Comair group. It will enable us to extend our vision and purpose as we expand our work locally and internationally, with both existing and prospective clients.

“As a true South African success story, Comair is well recognised for the quality of its leadership and its forward-thinking approach. It is an honour to become a part of this dynamic organisation.” Walsh adds that Metaco focuses on strategic development, organisational design and change management.  Its client base includes boards, leadership teams and individuals across a range of industries, in the public and private sector. The company offers a range of coaching and training modules for individuals and groups, developed in line with international best practice.

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