The Australian government has become the principal secured creditor of embattled operator Regional Express (Rex), after acquiring the carrier’s debt.
Transport minister Catherine King says her government has acquired A$50 million ($31.4 million) of debt from Rex’s largest creditor, PAGAC Regulus Holdings, a move she calls an “important step to prevent an adverse outcome for regional communities”.
King on 23 January adds that assuming Rex’s debt “makes clear” Canberra’s “ongoing commitment” to maintaining regional aviation access in the country.
Rex entered administration at the end of July as its financial challenges mounted after an expansion into jet operations.While its Boeing 737 flights were immediately grounded, the airline has continued its Saab 340 regional flights after the government agreed to guarantee these services.
Canberra has also provided a commercial loan of up to A$80 million to keep Rex’s operations going, and extended its flight-booking guarantee to enable to Rex to continue flying during an lengthened administration process.
A suitable buyer for Rex’s regional operations has yet to emerge.
