Monday, October 16, 2023

Indian steel giant front-runner to buy Go First - reports

Details are emerging in Indian media identifying entities that have lodged expressions of interest (EOIs) to buy insolvent Go First (GOW, Mumbai International). Applications closed on September 28, with the front runner reportedly Indian steel company Jindal Power. While several local and foreign airlines have also submitted EOIs, at least two foreign applicants are believed to be out of contention because their EOIs did not satisfy certain stipulated conditions.

Out-of-pocket lenders are reportedly backing any Hisar-based Jindal Steel & Power bid. Go First's resolution professional, Shailendra Ajmera, has so far accepted claims worth USD2.9 billion from operational and financial creditors. The airline's biggest lenders included the Central Bank of India, the Bank of Baroda, IDBI Bank, and Deutsche Bank. Go First suspended operations in May 2023. It has since secured approval from India's Directorate General of Civil Aviation (DGCA) to restart, albeit on a scaled down basis and under certain conditions. However, the airline has not yet managed to resume operations.

Jindal is a publicly listed company on the Bombay Stock Exchange with a market capitalisation of INR695 billion Indian rupees (USD8.35 billion). The Jindal family, now headed by Naveen Jindal, owns around 60.5% of the shares on issue.

The company was issued with a non-scheduled air operators permit by India's Directorate General of Civil Aviation in 2008 and formerly operated a Cessna 560 XL/XLS registered as VT-JSS (msn 560-5594). However, that aircraft was written off after a runway excursion at Vidyanagar in mid-2020.

According to sources close to talks, having lodged the EOI, Jindal is now conducting due diligence and attempting to value Go First's remaining assets. It is unclear whether they propose restarting Go First themselves or want to take on a strategic partner. However, interested parties cannot access the insolvent company's financial records without formally submitting an EOI.

16/10/2023 ch-aviation

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