[Peetwo]

JetGo liquidated; RossAir calls in administrators -   

Via ABC News:

JetGo forced to liquidate as Dubbo council wins Supreme Court case over unpaid debts
ABC Western Plains 
By Claudia Jambor and Karen Michelmore
Updated about 11 hours ago

PHOTO: JetGo may appeal the Supreme Court's decision, a former executive says. (ABC Illawarra: Justin Huntsdale)
RELATED STORY: Regional airline JetGo enters voluntary administration, cancels all flights
RELATED STORY: Airline may consider Rockhampton-Sydney direct flights
RELATED STORY: Dubbo set to get direct flights to Melbourne

Regional airline JetGo will be liquidated after a western New South Wales council was successful in its application in the Supreme Court today to wind up the company.

JetGo serviced cities across regional Australia including Wollongong, Dubbo, Wagga Wagga, Albury, Rockhampton, Townsville, and Karratha.
The company entered voluntary administration on June 1 and grounded all passenger flights.

The council's court action began before the directors of JetGo appointed voluntary administrators.

In a statement to the ABC, Dubbo Regional Council said legal action had been necessary because it was owed "significant outstanding fees" by JetGo and due to "the absence of any realistic proposal for payment".

"Dubbo Regional Council acted in the best interests of our community in this process and will continue to focus on stabilising airline services for our regional community," the council said.

"Unfortunately our community, along with many other communities and businesses, have been financially impacted by this business failure."

Company 'could have continued'

Former JetGo executive Paul Bredereck said the company was working through its financial issues and he was confident the services could have continued under another interested party.

He flagged an appeal of the court decision was being considered, and accused Dubbo Regional Council's legal action as having "vexatious intent".

"My initial response is a little bit dumbfounded as to why the application would be granted seeing as though it's going to significantly disadvantage the creditors," Mr Bredereck said.

"They don't give a sh**t about getting a better return for the creditors."
The successful wind-up application comes a day before thousands of JetGo creditors were set to vote on whether to liquidate the airline.

Despite the administrator recommending liquidation, Mr Bredereck said Dubbo Regional Council's actions had robbed the other creditors of their say in JetGo's future.

"They [Dubbo Regional Council] want this buried, done, dusted. They've got their own liquidator appointed. That's the height of arrogance," Mr Bredereck said.

"Why should the other creditors not get a vote and say who the liquidator is if a liquidator is going to be appointed?"

Focus turns to flights for regional Australia

Shellharbour City Council in the Illawarra region is among the councils that have lost flights and are owed money.

But the council's deputy mayor Kellie Marsh said she felt no animosity towards Dubbo Regional Council.

"The situation is how it is and Dubbo have made the move they have, and for right or for wrong that's what we have to run with now," Cr Marsh said.

Her main focus now was ensuring JetGo's flight services for the Shellharbour and regional Australia could be replaced.

"The need in regional Australia for regular passenger transport is certainly there," Cr Marsh said.

"I hope this isn't a sign of things to come."

Impact of decision felt across the country

In the Western Australian Pilbara region, the City of Karratha said it faced up to $850,000 in losses that it is unlikely to recoup.

JetGo had been due to start flights between Karratha and Brisbane this month, with flights to Singapore due later in the year.

In a statement, the City of Karratha said it had spent $848,763 on sponsorship installments with JetGo, to help the company prepare for the start of the new service, including pilot training, recruitment, progressing regulatory approvals, aircraft leasing, fit-out, and livery.

The council has registered as a creditor with the administrators, but it had been advised that if JetGo went into administration "the City is unlikely to recoup any costs as the City is not a secured creditor".

It said all passengers who had been booked on flights with JetGo had been advised that the services have been cancelled.

Passengers are urged to contact their financial institution to seek reimbursement of the ticket price.

City of Karratha Deputy Mayor Grant Cucel said the council remained committed to improving travel options from Karratha.

"We will continue to work with JetGo's administrators and the appointed liquidation officer to pursue our options to recoup any costs incurred, but we have been advised that this may be unlikely," he said in a statement.

"Costs incurred in trying to facilitate these services will not impact property rates or future budgets."

And from the Oz yesterday:

Headwinds force Rossair into administration

ANNABEL HEPWORTH
Adelaide-based Rossair yesterday announced it had gone into voluntary administration after months of “extreme adversities”.


The economics of the airline charter market are being closely watched after Adelaide-based Rossair yesterday announced it had gone into voluntary administration after months of “extreme adversities” stemming from a fatal crash last year.

Citing “several significant, external challenges”, AE Charter — whose businesses include Rossair Charter — said the board and management would help administrators in a bid to “investigate and pursue strategies to retain the value for all stakeholders”.

A statement yesterday pointed to “more than 12 months faced with extreme adversities” stemming from last year’s plane crash near Renmark Airport that left three people dead.

The “recent challenges have brought high levels of uncertainty and material costs”, a Rossair spokesman said.

Adelaide Airport managing ­director Mark Young said they are “concerned for the future of Rossair, which has played an important role in South Australia’s aviation history”. Rossair is based at Adelaide Airport.

“We will work with Rossair’s team and the administrator through this difficult and uncertain time,” Mr Young said.

Rico Merkert, an aviation expert at the University of Sydney Business School, said it was sad to see Australia’s second-oldest air transport company going into ­voluntary administration.

Whether issues like airlines not flying and operating costs, such as a rise in fuel price, were a “decisive driver” for upward pressure on fares remained to be seen, but “the direction seems to be clear”, he said.

South Australia Regional Development Minister Tim Whetstone yesterday told ABC Radio that it was “now up to Rossair to look at ways that someone could come in and rebuild Rossair or whether we have to introduce a new airline to provide a very valuable service to regional South Australia”.

Yesterday’s statement from Rossair said limited non-flying ­activities would continue while ­efforts were made “to put the business on a sustainable footing for the future”.

Ernst & Young partner Henry Kazar and director Lachlan ­Abbott have been appointed as administrators of AE Charter and Rossair Charter.

The move came despite Rossair last year striking an agreement with Essendon-based AusJet for a joint venture in the South Australian market.

Professor Merkert said the situation with airlines going into voluntary administration highlighted the challenges of running those kinds of operations.

Ben Wyndham, Airspeed Aviation managing director, said there was an increasing regulatory complexity facing the sector.

MTF...P2