Hopes for Eastern Airways as bidder for sister firm is picked

DEAL COULD HELP KEEP AIRLINE OPERATING

- By COREENA FORD

HOPES have been raised that part of the Eastern Airways business can be rescued after administrators struck an agreement with a preferred bidder, fresh documents reveal. Hundreds of jobs were lost last October when administrators were appointed to the Humberside Airport-based airline, days after all of its flights were suspended.

The UK short-haul specialist was plunged into difficulties after its key contract with KLM which saw Eastern flying four aircraft for KLM Cityhopper was cancelled "at very short notice", leaving it with huge fixed costs. That included an unsustainable number of employees, triggering the loss of more than 290 jobs since administrators at RSM UK were brought in.

The group consists of two companies - Eastern Airways (UK) Limited (EAUK) and Air Kilroe Limited - and reports for each have now been filed by the administrators, outlining the chain of events leading to the group's demise, as well as progress on a potential buyer. The reports serve up a glimmer of hope, telling how a preferred offer has been picked for Air Kilroe.