The Resolution Professional for Go Airlines (India) Ltd, Shailendra Ajmera, has called for Expression of Interest (EoI) for the private airlines.
The airline with Rs 4,183 crore revenue (for FY22) belonging to the Wadia Group has about 4,200 employees.
The last date for receipt of EoI is August 9, 2023 and the provisional list of prospective resolution applicants will be published on August 19, 2023. The last date for submission of objections against the provisional list of prospective resolution applicants is fixed as August 24, 2023.
Top officials of Go Airlines had told IANS that the Wadia Group is interested in continuing with the airline business. The Wadia Group had approached the National Company Law Tribunal (NCLT) voluntarily to protect their leased planes from being repossessed in May 2023.
Queried about the firewall that the promoters have built around Go Airlines against rival bids before landing in NCLT, Kaushik Khona, then Chief Executive Officer, had told IANS in an interview: "The process of NCLT and IBC (Insolvency and Bankruptcy Code) will be followed once the application is admitted. The question (takeover bids) is hypothetical to be addressed."
Khona had said the airline promoters -- the Wadia Group -- are interested to be in the business and the purpose of approaching the NCLT is to retain the aircraft as the lessors are taking action to repossess them.
He also said the idea of promoters rebidding for the airline was not thought of while approaching the NCLT. The insolvency petition is not a ruse to get loan write-offs.
"We have not asked the banks to take a haircut (write-off a portion of their loan)," Khona said.
According to reports, the airline has a total liability -- dues to banks, other creditors, vendors etc. -- of about Rs 11,463 crore.
The Union government-owned Central Bank of India said its outstanding exposure to Go Airlines as on March 31, 2023 was Rs 1,305 crore and an additional amount of Rs 682 crore sanctioned under the emergency line of credit guaranteed by the Government of India.
The airline has defaulted on its payment dues to aircraft lessors and others, but not to the banks and the account has not been classified as a non-performing asset (NPA) by the bankers.
With nearly 50 per cent of its A320neo fleet grounded, the country's third largest airline has approached the NCLT for resolution under Section 10 of the IBC.
The airline had said it has approached the NCLT "...due to the ever-increasing number of failing engines supplied by Pratt & Whitney's International Aero Engines, LLC, which has resulted in Go First (airline brand) having to ground 25 aircraft (equivalent to approximately 50 per cent of its Airbus A320neo aircraft fleet) as of May 1, 2023".
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