Monarch collapsed into administration yesterday, affecting the journeys of 860,000 passengers in the largest UK airline failure in history.
The failure of the Luton-based company led to transport secretary Chris Grayling ordering the “country’s biggest ever peacetime repatriation” to fly back 110,000 passengers stranded abroad.
The rescue operation will cost around £60m, the Civil Aviation Authority confirmed last night.
The collapsed carrier, which turned 50 in March, was placed into administration at 4am yesterday morning with all of Monarch’s 750,000 future bookings effectively cancelled.
Administrators KPMG confirmed last night that 1,858 employees at Monarch Airlines and Monarch Travel Group have been made redundant.
Eleventh-hour talks failed to save Monarch, which was under extreme financial stress due to factors including global terrorism, the weaker pound and intense competition from low-cost rivals on leisure routes.
The airline reported a loss of £291m for the year to October 2016.
“I am so sorry that thousands now face a cancelled holiday or trip, possible delays getting home and huge inconvenience as a result of our failure,” Monarch chief executive Andrew Swaffield told employees.
Greybull Capital, which acquired the business in 2014, said it was “deeply saddened” by the failure of Britain’s fifth-largest airline.
The fund manager is unlikely to recoup around £250m of debt and equity it has invested over the last three years.
Shares in Monarch’s rivals jumped yesterday with UK-listed airlines seeing around half a billion pounds added to their combined stock market valuations.
Easyjet and Wizz Air were among the biggest gainers, with the airlines’ shares closing up 5.18 per cent and 4.86 per cent respectively.
Easyjet also announced its “largest recruitment drive” yesterday to take on Monarch’s employees including cabin crew, pilots and head office staff.
Tina Milton, head of cabin services for Easyjet, said: “We will be holding recruitment days for Monarch cabin crew both in Luton and Gatwick this week with 500 positions still available.”
Cantor Fitzgerald’s Robin Byde said some of Monarch’s assets were a “good potential fit” for Easyjet and the firm is “likely” to try and pick them up from the administrators.
“The pilots are also likely to be in demand,” added Liberum analyst Gerald Khoo.
“Although Monarch’s all-Airbus fleet means that they would not be available to relieve Ryanair’s shortage.”
Ryanair operates an all-Boeing fleet.
Meanwhile, Grayling said Monarch’s failure does not mean the wider aviation sector is in trouble.
“Let nobody think this is a sign of general problems in our aviation sector,” the transport secretary said in a speech yesterday.