Bonza’s administrators unable to stop aircraft being taken out of Australia, court told

The future of budget carrier Bonza is looking desperately grim as a court hears five planes will be removed from Australia and there’s nothing administrators can do to stop it.

The future of budget carrier Bonza is looking desperately grim, with the Federal Court told on Tuesday the airline’s fleet is to be removed from Australia and there’s nothing administrators can do to stop that from happening.

A hearing before Justice Elizabeth Cheeseman was told the five Boeing 737 Max 8s are not in the possession of the airline, after the leases were terminated by AIP Capital 90 minutes before administrators were appointed.

Without access to aircraft it was difficult to fathom how Bonza could return to the skies, with staff told on Tuesday they would remain stood down for at least another week.

James Hutton SC for administrators Hall Chadwick and Bonza Aviation told the court the lessors had “clearly expressed their intention to take the aircraft out of Australia”.

“Consideration was given to every possible means to retain or bring into the administration the aircraft,” Mr Hutton said.

“We do not assert we have possession of them, we don’t (and) the lessors have expressed such an intention (to remove them from Australia) and we are not in a position where we are able to bring an application to prevent that from occurring should it otherwise occur.”

In a statement issued after the hearing, Hall Chadwick “regretfully advised that the lessors intended to enforce their rights and would seek to reposition the aircraft elsewhere”.

“This is a difficult situation, and the administrators recognise the significant impact on all stakeholders including Bonza’s employees and customers,” Hall Chadwick said.

The other challenges facing Bonza’s administrators was the logistics of the first creditors meeting set down for Friday because of the large number of people owed money by the airline.

Mr Hutton told the court there were in excess of 60,000 creditors with the three largest groups including 323 employees owed wages and annual leave; 57,933 customers with forward bookings and 120 trade creditors.

He said it was estimated as many as 20,000 customers may wish to participate in the creditors’ meeting which would be conducted physically and virtually at 11am on Friday.

“It’s the very large volume that your honour can appreciate presents some logistical difficulties,” Mr Hutton said, observing that the Virgin Australia administration did not involve the same sort of numbers because the airline continued to trade throughout the period.

It was agreed creditors would have until midnight on Wednesday to confirm their attendance at the meeting and submit questions should they wish.

Bonza chief executive Tim Jordan.

“If the numbers permit, the administrator will seek orders for a moderated Q and A session at the meeting,” Mr Hutton said.

“If the numbers are such that it’s not feasible to do that either for technological reasons or another reasons, and the written questions are sufficient we will put an affidavit to your honour on that.”

It was brought to Justice Cheeseman’s attention that the Australian Securities and Investments Commission was observing Tuesday’s hearing.

The corporate regulator has previously indicated its interest in the matter, with its own investigation under way into whether Bonza was trading insolvent.

A Bonza staff meeting held before the court hearing, was told administrators were exploring all options to allow the resumption of the airline, with discussions taking place with other airlines, potential investors and interested parties.

Bonza’s US owner, 777 Partners, is yet to comment on the airline’s financial woes, with the firm facing its own challenges as a result of a court case accusing the directors of fraud.

AIP Capital was also yet to issue a statement on its termination of the leased aircraft, which remain parked at Sunshine Coast, Gold Coast and Melbourne Airports.

Originally published as Bonza’s administrators unable to stop aircraft being taken out of Australia, court told