T-Rex? The sale to Air T includes Rex’s current network, pilot training academy, a maintenance organisation, and its frequent flyer business. Photo: Rex.
Creditors for the ailing Rex Airlines have voted to accept a buyout offer from US company Air T for the airline.
In an 11 November meeting of creditors in Sydney and via video, administrators EY Parthenon announced that creditors had voted in favour of a Deed of Company Arrangement (DOCA) proposed by Air T for the Rex Group.
The agreement follows Air T last month entering into a Sale and Implementation Deed with the administrators, a move which was welcomed by the Federal Government.
The administrators said that following the signing of the DOCA, the Rex Group will exit DOCA, and Air T will become its new owner by mid-December 2025.
The operations agreed under the acquisition include the regional airline business, which operates into 54 airports, the airline’s Australian Airline Pilots Academy (AAPA) training school, the aviation service provider Australian Aero Propellor Maintenance (AAPM), and the airline’s Frequent Flyer business, Rex Flyer.
EY Parthenon stated that the DOCA offers a superior outcome for stakeholders, with ongoing employment for the Rex Group’s existing employees, continued trading with suppliers, and the preservation of the Rex Regional Business, which connects remote and regional communities.
“On behalf of the Administrators, we wish to thank all of the staff who have ensured the seamless continuation of regular passenger services over the past 15 months, customers who have continued to support Rex through the Voluntary Administration, suppliers who have continued to support the business and the Australian Government who have provided extensive support to enable this outcome,” administrator Sam Freeman said.
In an 11 November statement, the Federal Government said it welcomes the announcement that the majority of creditors had voted in support of Air T’s bid to acquire Rex at the second meeting of creditors.
It said the government endorsed the bid and includes a support package comprising a loan of up to $60 million and a restructuring of existing government debt.
In exchange, it says Air T has agreed to a range of commitments aimed at preserving essential regional aviation connectivity and improving Rex’s governance arrangements.
The Transport Workers Union (TWU) has welcomed the sale. TWU National Secretary Michael Kaine said it will be a relief to regional Australia that critical routes have a guaranteed future after significant uncertainty.
“After a positive initial meeting with Air T, we are hoping to continue a constructive relationship with the airline’s new owners, and to see commitments towards workers and regional Australia fulfilled,” he said
The Regional Aviation Association of Australia (RAAA) said the government’s support for Rex should be extended to all Australian-owned regional airlines.
In an 11 November release, RAAA CEO Rob Walker stated that his association had strongly advocated for regional and remote communities to continue having access to vital air services.
“We are calling on the government to support all Australian regional airline operators, not just Rex,” he said.
“The announcement means that the government has provided over $220 million in support of Rex.
We are asking the government to also assist all hard-working Australian regional airlines,” he added.
“Assistance through government-backed loans, government guarantees, or tax incentives would potentially help.
“Without action on the key issues now, the future looks increasingly bleak for regional and remote aviation services.”
Mr Walker said regional communities across Australia risk losing critical aviation services without urgent political and policy action.
“RAAA member airlines operate regionally with similar-sized aircraft and the same operational costs as Rex,” he said.
“We are asking government to help secure the future viability and sustainability of aviation by supporting all regional airlines and the communities they serve.”
Original Article published by Andrew McLaughlin on PS News.
