Monday, July 10, 2023

Expression Of Interest Sought In Go First Potential Sale

A resolution professional responsible for managing the insolvency process of Go First has issued an invitation for Expression of Interest (EoI) for the sale of the airline, according to a leading media house. 

This EoI process is a formal step required by Indian law to seek potential buyers or investors. The deadline for submitting interest in the airline is 9 August. 

Go First filed for bankruptcy protection in May after grounding nearly half of its 54 Airbus A320neo planes, citing issues with faulty Pratt & Whitney engines. However, the engine company disputed these claims. The publication of the Form G, related to the EoI invitation, is the next prescribed step in the insolvency process, according to Abhirup Dasgupta, a partner at HSA Advocates, as quoted by Reuters. 

In the meantime, lenders have expressed concerns over a Delhi High Court order that prevents the airline from removing parts from the aircraft it intends to operate. The lessors own the aircraft but are unable to recover them due to the ongoing Insolvency and Bankruptcy Code (IBC) process imposed by the National Company Law Tribunal (NCLT). The committee of creditors previously approved funding of Rs 425 crore, but they fear that this requirement may hinder business operations. 

The resolution professional, Shailendra Ajmera, has filed an appeal in the Delhi High Court challenging the aforementioned order. Go First ceased operations and filed for insolvency in the NCLT on 2 May due to financial difficulties caused by grounding the majority of its planes due to supply issues from the American engine manufacturer. 

10/07/2023 Business World

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