US aviation conglomerate gets green light to take over collapsed airline Rex

An American company's bid to take over collapsed airline Rex has been given the green light by the latter's creditors.

The move paves the way for Rex to be operating under new ownership before Christmas, secures a $60 million loan from the federal government, and also officially ends its ill-fated attempt to compete with Qantas, Jetstar and Virgin on routes between capital cities.

Rex's administrators announced this afternoon that the company's creditors – including the government, which has poured in millions of dollars to keep the airline running since its collapse – had voted in favour of the takeover arrangement proposed by US aviation conglomerate Air T.

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Under the arrangement, Rex employees will keep their jobs and the airline will continue to operate routes to remote and regional Australia.

Administrators said they expected Air T to take legal and operational control of the airline by mid-December.

"We wish to thank all of the staff who have ensured the seamless continuation of regular passenger services over the past 15 months, customers who have continued to support Rex through the voluntary administration, suppliers who have continued to support the business and the Australian government who have provided extensive support to enable this outcome," administrator Sam Freeman said.

Flights between capital cities, which were cut when Rex entered administration last July, will remain on the scrapheap, as creditors voted to place the entity that ran them, Rex Airlines Pty Ltd, into liquidation.

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In a statement, federal Infrastructure and Transport Minister Catherine King said the government supported the takeover proposal.

Under the arrangement, the Commonwealth will provide a support package, which includes a $60 million loan.

"In exchange for this support, Air T has agreed to a range of commitments aimed at preserving essential regional aviation connectivity and improving Rex's governance arrangements," King said.

"The government thanks the administrators and Rex for working throughout the administration period to keep Rex flying and maintain critical aviation links for our regional communities."

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