Rex administrators EY will make a legal attempt to extend their control of the embattled airline, as the Federal Government promises conditional extra money worth millions to support the bid.
In a statement, Federal Transport Minister Catherine King said EY Australia (previously known as Ernst & Young) would ask the Federal Court to extend its convening period, which is set to end this month, to December 2025, and indicated further financial support would be provided if the Federal Court granted the extension.
“The sale process is progressing positively, with the administrators having narrowed the bidding field, and this would allow the administrators additional time to secure a market-led solution. The decision to grant an extension is a matter for the Federal Court,” the Minister said.
The Albanese government already bought $50 million of debt from Rex’s largest creditor and loaned it up to $80 million to keep regional routes running. If the extension is granted, Labor will also provide up to $30 million in extra finance to the administrators to keep regional routes operational until December, should it be needed.
“If approved, the Albanese Government will continue to assist regional communities in maintaining access to critical aviation during this time by extending the ticket guarantee on regional routes. The existing loan of up to $80 million provided to the administrators – which is yet to be fully expended – would remain available to ensure the airline can continue to operate,” the Minister said.
“In order to support the extension, if an application is granted by the Federal Court, additional financing of up to $30 million from the Australian Government to the administrators will also be made available should it be required to keep regional routes in the air until December.”
The Minister said the Government “continues to work closely with the administrators during their sale process for Rex”, with further details unable to be confirmed due to “ongoing negotiations and commercial confidentiality”.
“The Australian Government is not a bidder in the sale process but is undertaking necessary work on contingencies should a market-led solution not be achieved,” she said.
The news comes as a bid by Australian consortium Renaissance Partners is understood to have been knocked back by EY, as reported in The Australian.
King said the sale process was “progressing positively” with the administrators having narrowed the bidding field.
“This would allow the administrators additional time to secure a market-led solution,” she said.
“The decision to grant an extension is a matter for the Federal Court.”
