Saturday, July 22, 2023

Go First Receives Claims Worth Rs 240 Billion From Creditors : Report

Go Airlines Ltd has received claims worth Rs 240 billion from operational and financial creditors amidst its ongoing insolvency. Go First airlines which were operated by Go Airlines, filed for bankruptcy protection in May 2023.

The process is in accordance with Indian law regarding bankruptcy which allows every creditor a right to payment and remedy by submitting claims in the case of a company going bankrupt. After filing, these claims need to be verified by a resolution professional. 

A banker from a state-run bank, who has exposure to the airlines, said, "Claims from the lenders are around 50 billion rupees, while lessors' claims amount to 180 billion rupees so far", as reported by Reuters. 

The airline filed for bankruptcy earlier this year, after facing multiple engine issues resulting in flight cancellations and grounding of about half of its 54 Airbus fleet. It blamed engine maker Pratty & Whitney alleging they provided them with faulty engines causing operational breakdowns and financial losses for the airline. The U.S. based company strongly refuted these claims, alleging that Go First had a "lengthy history of missing its financial obligations". This resulted in a huge decline in Go First's market share from 11 per cent in November 2019 to 6.9 per cent in March 2023, as reported by Indian Express. 

22/07/2023 ABP Live


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