Regional airline Rex will continue to operate under U.S.-based aviation company Air T following a deal approved by the Federal Government.
Rex entered voluntary administration last year.
A majority of Rex’s financial lenders voted in favour of transferring ownership to Air T this week.
Air T said it is committed to “providing critical services to regional Australians.”
Rex
Rex is a regional-focused carrier and was once Australia’s third-largest airline.
The company struggled to recover from the COVID-19 pandemic. In the 2022/23 financial year, it reported a $30 million loss.
Last year, it entered voluntary administration, meaning it could no longer afford to pay its debts.
The Federal Government then gave the airline $80 million to maintain regional routes.
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Air T
Last month, Air T put forward a bid to acquire Rex.
The proposal was approved following a majority vote by Rex’s administrators during a meeting with the American airline this week.
In exchange for the Government’s support of the takeover, Air T has agreed to continue Rex’s regional routes and improve the company’s organisational structure. The airline will also retain current employees.
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Under the deal, the Federal Government has agreed to provide another $60 million loan. It has also approved a restructuring of the company’s current Government debt.
In a statement, Federal Transport Minister Catherine King thanked relevant stakeholders for their efforts to “keep Rex flying and maintain critical aviation links for our regional communities.”
Rex will continue to operate under a contractual arrangement agreed upon by administrators until the takeover is finalised.
