Luton-based Monarch Aircraft Engineering falls into administration

The engineering arm of collapsed airline Monarch has collapsed with the loss of 450 jobs.

Monarch Aircraft Engineering Limited (MAEL), based at London Luton Airport, is “unsustainable in its present form”, administrators KPMG, said.

Attempts to restructure the firm – taken over in October 2018 by Greybull Capital – had failed, KPMG confirmed.

This resulted in customers searching for “alternative suppliers”, it said.

Airline Monarch, which was also owned by Greybull, collapsed in 2017, leading to more than 1,800 workers being made redundant and the flights and holidays of about 860,000 people being cancelled.

“Following the administration of other Monarch entities in 2017, MAEL sought to build its customer base to replace the loss of business from the former airline,” David Pike, restructuring partner at KPMG, said.

“Through the insolvency of the airline however, the company inherited significant debts and claims. Every effort has been made to turn around the business, including launching a CVA which sought to resolve these legacy debts.

“Unfortunately, following the CVA, a number of customers reduced or sought to terminate their relationship with MAEL, further adversely impacting the business.”

Founded in 1967, the business employed about 553 staff across the UK and Europe and provided aircraft maintenance services across four main divisions – base maintenance, line maintenance, fleet technical support and a training academy.

Earlier this week, MAEL said line maintenance operations at Gatwick, Birmingham, East Midlands, Newcastle and Glasgow Airports will be largely transferred to Morson Group, with the Luton Airport operations transferring to Storm Aviation.

Some Gatwick-based employees have transferred to Boeing.

Further operations at Manchester and Birmingham Airports, including related employees, were transferred to Flybe.

These acquisitions safeguarded 182 jobs.

Buyers are being sought for the CAMO division – which provides the upkeep of airworthiness records and scheduled maintenance requirements – and its training academy.