Airline officials announced in the afternoon that all planes were being grounded, the Toronto Star reported. Passengers were told to discuss refunds with their credit-card companies.

Zoom operated as two companies, one in Canada and the other in Britain.

"We have done everything we can to support the airline and left no stone unturned to secure a refinancing package that would have kept our aircraft flying," the founders, Hugh and John Boyle, said. "Even as late as lunchtime today, we believed we had secured a new investment package to ensure future operations but the actions of creditors meant we could not continue flying."

Zoom planes had been grounded in Calgary and Glasgow before the announcement because of unpaid bills.