Court told investor found to ensure Aer Arann’s survival

AN investor had been secured to ensure Aer Arann’s survival as a going concern, the High Court was told yesterday.

And the High Court extended until Friday week its protection for Aer Arann after a judge was told that the new investor was coming on board.

Interim examiner, Michael McAteer, was appointed last August to the company, which employs 320 people, after the court heard it could not pay its debts due to a number of factors, including the global economic downturn and flight disruption from the volcanic ash cloud problem earlier this year.

It posted losses of some €18.5 million for the last two- and-a-half years.

An independent accountant’s report revealed the company which operates the airline, Comhfhorbairt Gallimh, has a reasonable prospect of survival if certain steps are taken.

Among its creditors are AIB, which is owed €3.9m, the Revenue Commissioners, the Dublin Airport Authority, Aer Lingus and the Irish Aviation Authority.

Yesterday, Rossa Fanning BL, for the examiner, told Ms Justice Mary Finlay Geoghegan a signed investment agreement was now ready and Mr McAteer is confident, subject to requisite votes of the company, that this will be sufficient to ensure the survival of the company.

That agreement and a scheme of survival should be in place by tomorrow subject to the resolution of a minor issue, counsel said.

Mr Fanning said there was either consent or no objection to the extension of protection from all the notices parties.

Ms Justice Finlay Geoghegan said she was glad to see Mr McAteer making such good progress and she extended protection to October 22.

Aer Arann began trading in 1970 and currently serves 25 routes, mainly between Ireland and the Britain. While it employs 320 directly, a further 200 jobs are being maintained due to its operations, mainly at regional airports.

The petition to enter examinership was made by the company following a resolution by its board of directors.

The airline has said it intends to operate normally during the period of examinership.

The examiner is in the process of finalising his scheme of arrangement and intends to issue these proposals to creditors in the coming days.

Creditors’ meetings will be held in the week beginning October 18.