John Holland Aviation Services expected to shut down within months

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John Holland Aviation Services (JHAS) is expected to shut down its operations n the coming months after its parent company announced that it would seek buyers for the Australian MRO firm's major assets.

John Holland Group (JHG) said in a statement that it is investigating the sale of JHAS’s facility at Melbourne Tullamarine airport and is winding back its operations there ahead of a plan to exit the business by the middle of the year.

“A number of potential purchasers have previously expressed interest in various parts of our business,” JHG managing director Glenn Palin adds.

The announcement comes after JHG’s parent company Leighton Holdings took a A$10 million ($9 million) writedown of the value of JHAS in late 2013. That is the same amount JHG paid for the assets of Ansett Aviation Engineering Services that were acquired in 2007 to launch the MRO operation.

In recent years the company has been focusing on line maintenance and overnight checks instead of heavy maintenance, as the high Australian dollar made offshore maintenance more cost-effective.

The firm has lost contracts with major customers such as Virgin Australia, Jetstar and Tigerair Australia, although it has increased its line maintenance activities for international airlines across Australia.