Rex administrator EY is understood to have received dozens of expressions of interest from parties interested in buying the regional carrier since the airline collapsed earlier in the week.
However, the understanding is that most of the interest comes from tyre kickers that are unlikely to be serious about buying the airline.
Meanwhile, since the carrier has collapsed, lender PAG’s interest in buying the airline is said to be waning, with its position being that it would take on the airline as owner if there were no other acquirers.
Its change in stance comes after the Australian government signalled a commitment to ensuring that the airline survives to service the regions. A deal involving the government playing a part could be increasingly likely, say sources.
In terms of groups that have expressed interest, it’s logical that the Sydney-based private equity firm Allegro Funds would at least take a look.
Also, funds out of Hong Kong and Singapore may show interest, while there could be groups out of the United States.
The cheque required to buy the business is unlikely to be worth not much more than $300m, given PAG is owed $120m and Westpac close to $200m.
Billionaire Andrew Forrest is believed to be side stepping the opportunity.
The other chance is Virgin Australia takes on more than the Rex 737 aircraft that it originally passed back to the airline from its own fleet – with its interest perhaps extending to the private jet business. And it’s not inconceivable that the government strikes a deal with Qantas to take on services.
Rex comprises the assets that once made up the failed airline Ansett, and the government at the time offered a deal to Qantas where it took on the operations for $1.
However, Qantas passed up the opportunity and instead Virgin and Rex were created.
To some extent, it could become an issue for the Australian Competition and Consumer Commission.
As of early Thursday, Houlihan Lokey was yet to be appointed to run the sale process for EY, but was in pole position to do so.
Working for PAG is Deloitte, while law firm Ashurst is also around the situation.
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