Go First, which is owned by the Wadia group, said on May 2 that it has filed for insolvency resolution and is unable to continue making payments. It attributes the grounding of 50% of its fleet on “faulty engines” manufactured by the US business Pratt & Whitney.
Go First, which is owned by the Wadia group, said on May 2 that it has filed for insolvency resolution and is unable to continue making payments. It attributes the grounding of 50% of its fleet on “faulty engines” manufactured by the US business Pratt & Whitney.
The troubled airline had earlier this week requested decisions on its request for a temporary moratorium from the National Company Law Tribunal, citing the urgency of the situation.
According to a story in ET, companies that have leased aircraft to Go Airlines are standing up outside the offices of its competitors IndiGo, Air India, and Vistara, selling the planes at competitive prices.
According to Bloomberg’s anonymous sources, Tata Group and IndiGo are also negotiating separately with Go First’s lessors and talking to airport operators about landing and parking slots. 36 aircraft are up for repossession, according to files with India’s aviation authority.
The firm asserted that its ability to continue operating would be jeopardized if it lost control of the planes and its legal authority to fly them. The carrier maintained that their petition is not a malevolent attempt to get out of paying dues but rather a complete debt restructure.
The desire for a moratorium, on the other hand, was opposed by the lessors of aircraft, who claimed that it would have negative and grave repercussions.
The entire amount owed by Go First to all creditors, including banks, financial institutions, suppliers, and lessors of aircraft, is Rs 11,463 crore. Banks including Bank of Baroda, IDBI Bank, Central Bank of India, and Deutsche Bank are listed as financial creditors of Go First in its bankruptcy declaration.
A consortium loan has exposed the Central Bank of India and the Bank of Baroda to a total of Rs. 1,300 crore. According to the document, IDBI Bank has a lower exposure of Rs 50 crore.
