Prospects for a rescue of Oasis Hong Kong Airlines suffered a serious setback yesterday when its provisional liquidator ran out of funds to pay the nearly 700 staff and made all but a handful redundant.
'Clearly, this news has implications for any prospective rescue, even if there's one still there,' said Edward Middleton, of accounting firm KPMG, the provisional liquidator.
Without pilots or cabin crew to operate its aircraft, Oasis - saddled with HK$1 billion of debt - is even less attractive as an asset to a potential investor. Experienced pilots and cabin crew are in high demand.
There are also regulatory issues to consider.
KPMG has received no firm investment proposals for the 17-month-old start-up, the world's first budget long-haul airline, since being called in 10 days ago.
Asked if the dismissal of the staff made it less likely that Oasis would fly again, he said: 'It certainly makes that scenario slightly more difficult to achieve.' Still, Mr Middleton - KPMG's head of restructuring services - said his hopes, while they had never been very high, were not lost.
'We're not officially dead,' he said.