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Air Vanuatu’s liquidator says it has received several expressions of interest in the airline.
While it could not disclose the number or the nature of the interested parties, Ernst & Young confirmed it had received non-binding offers for the Vanuatuan flag carrier, which went into voluntary liquidation last month owing at least $99 million.
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“We have received interest from a range of parties seeking to resume Air Vanuatu’s operations,” said Morgan Kelly, partner in strategy & transactions at EY.
“We’re reviewing these offers and will be working toward a resolution as soon as possible.”
The offers are being considered as part of a structured sale or recapitalisation process, said Ernst & Young, with the aim of securing the best outcome for creditors.
“The assets of the business include international airport slots in Brisbane, Melbourne, Sydney, Auckland, New Caledonia and Fiji, as well as owned and leased aircraft and other assets,” the liquidator said.
“The liquidators will update creditors as they are able to. A date of resumption of Air Vanuatu services is yet to be determined.”
EY at the end of May axed 170 jobs from Air Vanuatu, saying it was looking to “right-size the company’s cost base” as it proceeded with the expressions of interest campaign.
“The restructuring at Air Vanuatu today is an unfortunate but necessary step to give the business the opportunity to bring on board new investors and capitalise on strong domestic and international demand for travel. This restructuring attempts to position Air Vanuatu for growth into the future,” said Kelly at the time.
“Despite its significant financial difficulties, the Liquidators are committed to identifying a solution to Air Vanuatu. We share the Vanuatuan Government’s view of strong demand for tourism driving international demand, and this to support demand for key domestic routes.”
Air Vanuatu has been experiencing maintenance difficulties with its only jet aircraft, a Boeing 737-800, which has not flown since January. The airline also operates an ATR 72-600 for inter-island travel.
Virgin Australia is currently the only other airline flying between Australia and Vanuatu and has moved to expand its Brisbane–Port Vila services in the wake of Air Vanuatu’s collapse.
Qantas Group has also applied for capacity to Vanuatu, with plans to start Qantas services in August and Jetstar services in October, a spokesperson confirmed.
“There are a number of airlines exploring plans to operate new flights or increase services between Australia and Vanuatu, including Qantas and Jetstar,” the spokesperson said.
“We’ll keep our customers updated as our plans progress.”
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says:The primary concern at the moment is ensuring that action is in place to ensure their B737-800 is serviceable and crews are certified for operations. Having such a unit U/S for six months beggars’ belief unless of course there is no money to pay for the parts.
As for potential suitors I would hope that we in Oz will play a major part in the airline’s revitalization, the last thing we need is another private equity mob butting in and foraging for profits.