Hundreds of Irish holidaymakers will suffer disruption this summer after Shannon-based airline EUjet suspended all flights and called in administrators amid financial difficulties at its parent company.

The airline, which operated eight flights a week from Shannon to various European destinations, and a daily service between Dublin and Kent in England, said yesterday it had "no alternative" but to suspend all airline operations and appoint an administrator.

Former Ryanair executive PJ McGoldrick, who founded EUjet in 2002 and is the group's chief executive, said that the company would continue to meet with interested parties to discuss a possible purchase of the airline.

All fares are being held by the company and customers who have already booked flights will be able to claim a refund from their credit card provider, he said.

The airline employs about 40 people at Shannon airport.

Planestation, the company's parent and owner of Kent Airport, said yesterday it is also seeking to go into administration after talks with banks on further financial support broke down.

Mr McGoldrick said that EUjet could not continue without operations from Kent Airport.

Shares in Planestation were suspended on Monday after the company's banks said they were no longer prepared to support the company with additional facilities. Planestation said last month that EUjet would carry fewer passengers than forecast this year and would therefore need more money to continue operations.

Mr McGoldrick attributed the decline in passenger numbers to the difficulties associated with starting operations from a cargo airport such as Kent.

The closure of EUjet comes just five years after Mr McGoldrick was forced to close Shannon-based TransAer. After 10 years of successful business, the airline was grounded with liabilities of more than €30 million and the loss of 450 jobs.

From Shannon, EUjet operated routes to Malaga, Ibiza, Palma de Majorca and Murcia-San Javier in Spain, Faro in Portugal and Kent.