Race to acquire Rex's assets amid administration

ALMOST two months after Regional Express (Rex) entered administration, the regional airline’s assets are being dismantled and sold.

First up for sale is its varied property portfolio, which holds little interest for other industry players but could appeal to those looking to acquire the airline’s operations and its fleet of Saab 340 aircraft.

Rex’s downfall was triggered by a boardroom conflict between the airline’s chairman, former Howard government minister John Sharp, and its largest shareholder, businessman Lim Kim Hai.

Lim Kim Hai has already acquired several of Rex’s properties and is eager to purchase more. According to sources familiar with the auction process, handled by Houlihan Lokey, Lim recently bought a property in Mascot, near Sydney airport, and has expressed interest in acquiring additional assets owned by Rex.

Sharp and Lim have been involved with Rex since rescuing it from the collapsed Ansett and its regional subsidiaries, Hazelton and Kendell Airlines, in 2002. 

The next critical deadline for bidders is the end of the month, when those interested in acquiring Rex’s operating business must reconfirm their offers.

While a frontrunner has yet to emerge, there is significant interest, particularly from groups that view Rex’s regional operations as a valuable addition to their own.

Potential buyers include fly-in-fly-out operator Alliance Aviation which has previously expressed interest in servicing the King Island route bringing golf groups from Queensland, specialist airline Skytraders, and Bain Capital’s Virgin Australia.