Air T Takes Over Rex Airlines Ensuring Regional Connectivity in Australia

Air T Secures Rex Airlines’ Regional Future, Ending a Period of Uncertainty

In a decisive move for Australian aviation, creditors have given the green light for the takeover of Regional Express (Rex) by the US-based aviation company, Air T. This approval officially concludes a challenging 15-month period of voluntary administration for Rex, which commenced in July 2024 amidst significant financial pressures. The deal is a critical development, ensuring the continuity of essential air services that connect 54 regional airports across the nation, a lifeline for many communities.

The journey through administration has been a complex one, navigated by administrators from EY Parthenon and closely watched by the Australian government. Recognizing the vital role Rex plays in regional infrastructure, the government stepped in to become the principal secured creditor, acquiring a substantial portion of the Airlines‘ debt to stabilize its operations. This intervention paved the way for a viable acquisition, highlighting the strategic importance of maintaining robust regional air networks.

With the transition of ownership to Air T expected to be finalized by mid-December 2025, a new chapter begins for Rex. While the core regional operations are set to continue and grow under new leadership, the Acquisitions also marks a significant shift in the airline’s structure. The entity that operated the Boeing 737 services connecting major capital cities will be liquidated, signaling a strategic refocus on the airline’s foundational regional network.

The Nuts and Bolts of the Takeover

The acquisition by Air T, a holding company with a diverse portfolio in the aviation sector, encompasses the core assets of Rex’s regional operations. This includes its fleet of Saab 340 aircraft, the Australian Airline Pilots Academy (AAPA), Australian Aero Propeller Maintenance (AAPM), and the Rex Flyer frequent flyer program. The sale, valued at $172.5 million, is structured to preserve the essential services that form the backbone of the airline’s business.

A crucial element of this process was the second meeting of creditors held on November 11, 2025. In this meeting, the Deed of Company Arrangement (DOCA) proposed by Air T was formally approved. This vote was the final significant hurdle in the sale process, allowing the administrators to proceed with finalizing the conditions and formally handing over control. The approval represents what administrators have called the “best outcome for everyone involved,” securing jobs and maintaining critical supply chains.

However, the deal is not without its hard edges. The entity responsible for Rex’s expansion into the domestic market with Boeing 737 jets, Rex Airlines Pty Ltd, is not part of the acquisition and is slated for liquidation. This strategic decision separates the historically stable regional business from the more recent and capital-intensive venture into major city routes. While this secures the regional network, it means that ordinary unsecured creditors are not expected to see a return from the sale.

“This is the best outcome for everyone involved. It will see the preservation of jobs, the continuation of supplier relationships and the continuation of air services to the 54 regional Airports to which Rex flies.”, Sam Freeman, Administrator, EY Parthenon

Government’s Role and Future Commitments

The Australian government’s involvement has been pivotal in steering Rex through its financial turbulence. Transport Minister Catherine King confirmed a significant support package designed to facilitate the takeover and ensure long-term stability. This package includes a loan of up to $60 million and a restructuring of existing government debt, demonstrating a firm commitment to preserving regional connectivity.

In exchange for this substantial financial backing, Air T has made several key commitments. The new owner has agreed to maintain essential regional air services, a core condition of the government’s support. Furthermore, Air T has committed to improving the airline’s governance structures, aiming to build a more resilient and sustainable business model for the future. These commitments are designed to safeguard the interests of regional communities and ensure the airline operates on a solid footing.

The Transport Workers Union (TWU) has expressed relief and optimism regarding the sale’s approval. TWU National Secretary Michael Kaine noted that the deal provides a “guaranteed future” for critical regional routes after a prolonged period of uncertainty. This sentiment is shared across regional Australia, where the reliability of air services is not just a matter of convenience but a crucial component of economic and social well-being.

A New Horizon for Regional Aviation

The approval of Air T’s takeover of Rex marks the end of a precarious chapter and the beginning of a new one focused on stability and core service delivery. By securing the airline’s regional network, the deal ensures that dozens of communities across Australia will retain their vital air links for transport, business, and essential services. The strategic decision to hive off the Boeing 737 operations and focus on the Saab 340 fleet suggests a return to the airline’s foundational strengths.

Looking ahead, the success of this new era for Rex will depend on Air T’s ability to effectively manage and invest in the regional operations, coupled with the ongoing support from the government. The commitments to maintain services and improve governance provide a solid framework, but the dynamic nature of the aviation industry will undoubtedly present future challenges. For now, regional Australia can breathe a collective sigh of relief, knowing its connection to the rest of the country is secure.

FAQ

Question: What parts of Rex’s business did Air T acquire?
Answer: Air T acquired Rex’s regional airline services, which use Saab 340 aircraft, the Australian Airline Pilots Academy (AAPA), Australian Aero Propeller Maintenance (AAPM), and the Rex Flyer frequent flyer program.

Question: What happened to Rex’s Boeing 737 flights between major cities?
Answer: The entity that operated the Boeing 737 services, Rex Airlines Pty Ltd, was not included in the takeover and will be placed into liquidation.

Question: How was the Australian government involved in this process?
Answer: The Australian government played a significant role by becoming the principal secured creditor and providing a financial support package, including a loan of up to $60 million, to ensure the stability and continuation of regional air services.

Sources

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