‘High confidence’: Rex Airlines rescued by US outfit Air T

Rex Airlines will be purchased by US-based air services company Air T Inc, with the deal to lift the debt-laden airline out of administration and be recapitalised, ending a period of uncertainty for Australian aviation.

The deal, announced late on Tuesday, will provide regional Australia with the first glimmer of stability over its air transportation options after Rex spent more than a year in limbo.

However, administrators E&Y warned that 4800 creditors who are owed a combined $500 million will probably receive nothing.

“No return to shareholders is anticipated,” E&Y said, in a statement, although a further update will be provided ahead of the second meetings of creditors.

Rex Airlines was placed into administration with crippling debts in July 2024, with the Albanese government vowing to back the airline, which has a crucial role in connecting regional Australia to major cities.

The Charlotte, North Carolina-based aviation servicing company’s decision to buy Rex draws to a close a saga that has dragged over a year, as the administrators sought to sell the troubled airline.

Air T, which supplies transportation to FedEx, also services commercial aircraft, engines and parts, and provides ground support equipment, including de-icers. Air T was approached for comment.

In 2024, the federal government gave up to $80 million in loans to keep Rex’s regional routes operating until mid-2025. It also took on $50 million of debt from Rex’s largest creditor, PAGAC Regulus Holdings Limited this year, to ensure Rex could keep flying.

“The administrators would like to thank the Australian government for their support to date in assisting to facilitate the proposed transaction,” E&Y said.

“Reliable air connectivity is fundamental to the social and economic wellbeing of regional Australia,” said Australian Airports Association CEO Simon Westaway.

Maintenance, repair, and overhaul is a globalised business with planes routinely travelling distances for servicing, experts said. Air T is thought to have the supply chains needed for regional aviation in place to provide the needed maintenance for Rex’s ageing fleet of 22 Saab 340B and 35 Saab 340B Plus aircraft.

Rex CEO Nick Swenson, said: “This acquisition aligns with our deep experience in regional aircraft, and long-term commitment to the sustainable growth of our portfolio of powerful businesses.”

“We have high confidence in the quality of Rex Regional’s management team and employees. We like the Saab 340 program.”

Rex is challenged by the age of the planes and scarcity of parts. Air T’s other subsidiaries service “regional/commuter turboprops” which could position Air T with the industry knowledge to address Rex’s fleet troubles.

In addition to its facilities in the US and UK, Worthington Aviation has a small presence at Brisbane Airport where it “supports regional and corporate aircraft”. Worthington currently has certification to repair planes registered in the US or Europe but not CASA-registered planes.

An Air T lease for a separate small property in Australia expired in April, according to Air T’s filing with the US Securities and Exchange Commission.

In 2025, the company made 42.5 per cent of its revenue ($US124 million) through overnight air cargo contracts, followed by 40.5 per cent in commercial aircraft repairs and overhauls ($US118 million).

“The Australian Government welcomes these announcements, which mark a positive step towards bringing Rex out of voluntary administration,” transport minister Catherine King’s office said in a statement.

King’s office also said the Australian government had entered into an agreement with Air T to restructure Rex’s financing arrangements.

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