Aer Arann put under examinership
Irish regional airline Aer Arann has been put under examinership after suffering 18 million euro losses since 2008.
The company said it had been on course to meet budget targets this year but was badly hit by the volcanic ash crisis.
The High Court in Dublin intervened to protect the business ahead of a full examination of its financial affairs in September, while Aer Arann said customers would not be affected and flights would operate as normal ahead of the full hearing.
In a statement, it said: "Aer Arann intends to operate normally during the period of examinership and intends to fly all Aer Arann services and all Aer Lingus Regional services operated under the airline's franchise agreement with Aer Lingus. No flights have been cancelled or are planned to be cancelled."
It added: "The decision to petition for examinership follows two years of loss-making trading in a difficult economic environment with recession negatively impacting the global aviation industry followed by the volcanic ash disruptions this year."
Aer Arann said it lost 6 million euro in both 2008 and 2009 and another 6 million euro this year after European air space was shut following the prolonged Icelandic volcanic ash crisis. The move to apply for interim examinership was taken following a meeting of Aer Arann's board of directors.
Examiner Michael McAteer from Grant Thornton has been appointed to the company pending the September 8 High Court hearing in Dublin. Aer Arann also said it expects to remain in examinership for up to 70 days after that and that it has a viable business plan.
"Aer Arann and the Examiner will also use the time to negotiate with potential investors and a number of parties have expressed their interest in the airline," the troubled airline said.
Aer Lingus also issued a statement insisting the franchise agreement remained in place. The airline said: "Aer Lingus regional flights, operated by Aer Arann, will continue to operate normally and customers who hold bookings on these flights need not be concerned as there will be no disruption in service."
Under Irish company law examinership effectively gives a business with a reasonable prospect of survival breathing space to deal with financial difficulties.