The Airline requested a trading halt at the share market opening on Wednesday, prior to an announcement that it was pursuing the purchase of National Jet Express from Cobham Aviation. This will help REX increase its foothold in the fly-in, and fly-out (FIFO) services to have a 20% share in that industry.
This comes as Cobham’s private equity owners appointed an investment bank to canvas sale options prior to the pandemic. The sale includes the addition of eight Bombardier Q400 turboprops and six Embraer E190 jets which will join Rex’s fleet of sixty Saab 340s and six Boeing 737-800s. (The airline announced it would increase the 737 fleet to fourteen as aircraft became available.)
National Jet Systems began operations on July 1st, 1990 operating regional services for then Australian Airlines. Its National Jet Express division offered services for cargo, charter, and eventually scheduled services under the National Jet branding. In 2009 the airline was sold to Cobham and was renamed Cobham Aviation Services Australia. It currently operates cargo services for QantasFreight, single entity charters for the mining industry, and patrol flights for Surveillance Australia.
REX is Australia’s largest independent regional airline which was formed by former Ansett employees through Australiawide Airlines Ltd by combining operations of Ansett’s feeder airlines Hazelton and Kendell airlines. REX acquired Pel-Air and Air Link a charter operator based at Dubbo but operates them under their respective brands.
Rex is accessing $15 million from a credit line with a longstanding investor and the $9 million from the airline’s cash reserves. $24 million is coming from private funds held by joint venture partners, including Rex Chairman Lim Kim Hai.
Given that National jet has operated BAe-146 freighters for QANTAS for a number of years, it can only be assumed that this agreement will be on borrowed time. With QANTAS set to wholly own Alliance Airlines once it can finalise the aquasition, One again the Airlines that service Australia will be back to three majors.
The deal which is subject to ACCC approval will be completed as soon as a review into it is done by them.