Hope fades for Air Australia rescue

Hope fades for Air Australia rescue

At least 4,000 Australian passengers were stranded overseas by the collapse of Brisbane-based budget carrier Air Australia last week.

Administrators tried to find a "white knight" to save the airline and the jobs of its 300 workers, but now the airline’s aircraft are expected to be repossessed by their owners, dashing hopes of a rescue.

Turkish airline Atlasjet has already repossessed an Airbus A330 aircraft which was left stranded in Phuket, Thailand, after a fuel supplier refused to extend credit, prompting the airline to appoint administrators.

Mark Korda, a spokesman for administrators KordaMentha, said the airline had run out of money to refuel its aircraft. The administrators are still untangling the web of companies associated with the airline in Australia and overseas.

A long list of creditors, including airports, caterers and refuellers, will gain their first insight into what led to the collapse and the extent of their likely losses at the first creditors’ meeting in Brisbane on February 29.

Flight Centre in Australia said as many as 10,000 of its customers with future bookings were affected by the collapse.

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