Eastern Airways rescue collapses after bidder pulls funding, forcing break-up sale

Eastern Airways rescue collapses after the preferred bidder withdrew funding, forcing administrators to break up the regional airline for asset sales. According to documents filed by joint administrators at RSM, the deal for North Lincolnshire-based Eastern Airways and affiliated Air Kilroe collapsed less than three weeks after exclusivity was agreed. The airline entered administration in November 2025 after suspending operations and making most of its 330 employees redundant, following the loss of a major contract with KLM Cityhopper that sharply reduced revenue. Administrators had secured about £286,000 from the buyer process and £700,000 from Gordon Brothers Asset Ingenuity to preserve the business during the sale. Air Kilroe’s nine unencumbered Jetstream 41 aircraft were sold to an undisclosed buyer for an initial £950,000, with additional components sold for $850,000. Creditors’ recoveries look limited, including Santander’s expected shortfall and HMRC’s claim likely recovering about 28p per pound.