URGENT UPDATE: New reports confirm that embattled airline Rex Airlines has found a buyer, yet Far South Coast councils are projected to lose around $200,000 in owed debts. The announcement came from Rex’s administrators on Tuesday, July 25, 2023, over a year after the airline collapsed into administration.
The prospective sale to US company Air T must still receive approval from creditors. However, indications suggest that shareholders will receive nothing, leaving many smaller creditors, including local councils, at risk of substantial financial loss. Eurobodalla Shire Council confirmed it is owed $55,000 and stated they will attend the creditors’ meeting, but they are “unlikely to see this money.”
In addition, Bega Valley Shire Council is facing an even larger loss of approximately $144,000 due to Rex’s usage of Merimbula Airport. A spokesperson from Eurobodalla Council expressed concern, stating, “From council’s point of view, the priority is that flights to Moruya continue.”
Despite the uncertain financial future, the spokesperson emphasized the necessity of establishing a good relationship with the new owners, although they acknowledged that regional councils may be low on their priority list. “It will be some time before we can begin those relations,” the spokesperson added.
Throughout Rex’s administration, Eurobodalla Council has been advocating to both federal and state governments, highlighting the need to maintain the Moruya service for the community. “Statements from state and federal representatives indicate that our messaging has been heard, but the risk remains,” the spokesperson warned.
Federal Minister for Regional Development and Local Government Kristy McBain affirmed the significance of Rex in connecting regional communities. “I actually flew with Rex Airlines yesterday, and it’s always a great service. It’s been really important to me and the Albanese government that we’ve kept Rex services operating while a new buyer has been found,” McBain stated.
She continued, “While there are a few more steps that need to occur, it’s good news that a buyer for Rex has been identified. That’s a really important step.” McBain reiterated the importance of regional connections, saying, “Private companies will make their own commercial decisions, but we’ve made it clear that services to places like Merimbula must continue.”
As the situation develops, local councils and communities await the outcome of the creditors’ meeting and the finalization of the sale. The future of regional air travel hangs in the balance, making it crucial for residents and local leaders to stay informed about the unfolding events surrounding Rex Airlines.
Stay tuned for updates as this critical situation develops, impacting countless travelers and local economies across the region.
