Page last updated at 15:47 GMT, Friday, 13 June 2008 16:47 UK

Silverjet sacks entire workforce

Silverjet promotional image
There had been hopes of a rescue deal for Silverjet

Business airline Silverjet has sacked its 420-strong workforce after talks over a rescue deal broke down.

Investment firm Kingsplace had been in talks to acquire Silverjet and earlier this week said it expected Silverjet to be flying "in a matter of weeks".

But Silverjet's administrators said "unusually complex negotiations with third parties" meant Kingsplace could not acquire Silverjet.

Hit by soaring oil prices, Silverjet ceased operations in May.

'Disappointed'

Begbies Traynor, Silverjet's administrator, said the entire workforce was made formally redundant on Friday.

"We are extremely disappointed to have had to make these redundancies, which we have been working hard to prevent," the Begbies Traynor statement said.

AIRLINE PRESSURE TIMELINE
24 December, 2007: US business-only carrier Maxjet announces it has filed for Chapter 11 bankruptcy
27 April, 2008: American business-class airline Eos also files for Chapter 11 bankruptcy
23 May, 2008: Silverjet shares suspended on Aim
30 May, 2008: Silverjet calls in administrators
11 June, 2008: Kingsplace says it expects Silverjet to re-launch services "in a matter of weeks"

The airline employed 370 pilots and cabin crew and 50 administrative staff in Luton.

The administrators said they would continue to negotiate the sale of Silverjet's assets for the airline's creditors.

Before talks with Kingsplace, Silverjet had pinned its hopes on a $25m (13m) injection from a Middle East investor.

But a deal failed to materialise, affecting the travel arrangements of some 10,000 customers flying from London Luton to New York and Dubai.

Shares in the carrier were suspended in May.

Airline worries

Several airlines have been affected by the spiralling cost of fuel which reached a peak of more than $139 a barrel last week.

Additionally, consumers cutting down on non-essential spending and an increase in competitive pressures have meant many airlines now either charge customers for services that were previously free - such as baggage check-in - or have gone into administration.

US business-class airlines Eos and Maxjet recently collapsed when their finances dried up.

Eos filed for Chapter 11 bankruptcy in April due to "insufficient costs", while Maxjet succumbed to funding pressures in December after failing to raise capital.




SEE ALSO
Silverjet to take to skies again
11 Jun 08 |  Business
Swiss firm 'in Silverjet offer'
08 Jun 08 |  Business
Q&A: Air passenger rights
28 Mar 08 |  Business
Silverjet calls in administrators
30 May 08 |  Business
Silverjet shares suspended on AIM
23 May 08 |  Business
Silverjet secures $25m investment
30 Apr 08 |  Business
US business airline Eos goes bust
27 Apr 08 |  Business

RELATED INTERNET LINKS
The BBC is not responsible for the content of external internet sites


FEATURES, VIEWS, ANALYSIS
Has China's housing bubble burst?
How the world's oldest clove tree defied an empire
Why Royal Ballet principal Sergei Polunin quit

BBC navigation

BBC © 2013 The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.

Americas Africa Europe Middle East South Asia Asia Pacific