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Transport Minister Catherine King has reaffirmed the federal government’s backing of Rex, saying the ailing regional carrier is “too important to fail”.
Speaking to media in Hobart, the minister said the government has been “working pretty closely” with administrator EY Australia, and remains ready to step in and potentially buy Rex to preserve its vital services if EY cannot make a commercial sale.
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“We want a viable regional airline, and that’s basically what the Australian Government has said really clearly. We know that Rex has been an important player in the delivery of regional services across the country. It is too important to fail,” she said.
“It is why when it went into administration, we said very clearly we’d like to see, in the first instance, a commercial outcome, and we’ve worked to support that. But if that is not the case, then we stand willing to step in. We’re still hopeful that there is obviously a commercial buyer for Rex.
“The administration has now been extended until December. The Federal Court did that recently, and we’re obviously hopeful for a commercial solution to ensure that Rex keeps flying and continues to be a really significant part of the regional airspace.”
The news comes after reports that the government had unsuccessfully courted Virgin Australia to buy Rex earlier this year. In a statement, a spokesperson for the minister reiterated that the sale process is in the hands of the administrator.
“The Albanese Government previously announced that it will work with bidders shortlisted by the Voluntary Administrators on possible supports to maximise the prospect of a successful sale,” the spokesperson said.
“Due to the commercial in confidence nature of the ongoing sale process, the Government cannot provide further commentary.
“The Government continues to work on contingency options in the event the market sale process is not successful in order to support continued service to regional Australians.”
The voluntary administration was earlier this year extended by another six months, meaning EY Australia will now have until 5 December to wrap up the second sale process, which was slated to end on 30 June.
It is the second extension to the administration period, and came as the administrator indicated potential buyers were waiting in the wings.
The federal government has previously indicated it would look into purchasing Rex itself if the current sale process falls through, making it the first nationalised airline in Australia since the privatisation of Qantas in the 1990s. The February announcement came after $80 million in funding and the purchase of $50 million in Rex debt from financier PAG.
