A LOW COST airline has been wound up before it had even carried its first passengers.

Now Airlines, based in Luton, was set up at the start of last year to challenge no-frills carriers such as easyJet and Ryanair.

But a spokesman for the Official Receiver said last night that the company went into compulsory liquidation last month.

The High Court in Manchester issued the winding up order against Now after being petitioned by an alleged creditor of the company.

The spokesman declined to reveal how much Now owed, but said: "The assets of the company will be used to pay creditors."

Liquidation is a terminal process and is followed by the dissolution of the company.

In a statement on its website, Now said it had deferred the launch of its services until further notice and was considering a restructuring plan.

It said it had experienced problems with completing agreed funding for the business.