Go First lenders weigh liquidation, asset evaluation, and buyer options, vote result awaited
New Delhi, Jan 5 (IANS) Go First lenders held a meeting on Friday on a series of proposals aimed at navigating the precarious financial situation the cash-strapped carrier finds itself in.
In a bid to facilitate a more thorough evaluation process, lenders also voted on a proposal to extend the Expression of Interest (EOI) deadline, a source aware of the development told IANS.
This extension is intended to provide interested parties, including the domestic carrier SpiceJet, with additional time to submit their resolution proposals.
One of the major points discussed was a proposal to liquidate Go First, acknowledging the severity of its financial struggles.
The lenders are faced with the challenging task of deciding whether liquidation is the most viable option to mitigate their losses.
Another proposal on the table involved selecting a reputable firm to conduct a comprehensive evaluation of Go First’s remaining assets.
Simultaneously, the lenders mulled over a proposal to assess potential buyers interested in acquiring Go First’s assets.
Identifying and engaging with interested parties could offer a lifeline to the airline and its creditors, allowing for a smoother transition or potential revival.
The fate of Go First now hinges on the outcomes of these crucial deliberations.
“However, voting results will come in the coming days,” said an insider familiar with the developments, underscoring the sensitivity and complexity of the decisions at hand.
Established in 2005, Go First filed for voluntary bankruptcy in May 2023, citing outstanding debts exceeding Rs 6,521 crore, primarily owed to lenders, with a significant portion owed to public sector banks.
Amid speculations that the Wadia Group might submit a bid for Go First, potentially with the involvement of a global fund, the conglomerate ultimately did not proceed with such a bid.
In a surprising turn of events in December, Sky One, an aviation company based in Sharjah, and SpiceJet expressed interest in acquiring the financially beleaguered Go First. This development occurred after the proposal deadline had passed and while lenders were considering the possibility of liquidation.
Both entities sought permission from Shailendra Ajmera, the resolution professional overseeing Go First’s corporate insolvency resolution process (CIRP), to conduct due diligence on the grounded airline.
Recently, the RP submitted an affidavit in the Delhi High Court stating that 2,278 employees remain on the rolls of the company, out of which none are at present reporting to work.
“Various personnel of the engineering and records team who were required to undertake maintenance activities have either gradually resigned or are not reporting to work due to non-payment of salaries,” read the affidavit by Ajmera. “As on insolvency commencement date, the number of employees on the rolls of the Corporate Debtor stood at approx .. 4,621. However, as of 10.10.2023, approx ..2,278 employees remain on the rolls of the Company, out of which none are at present reporting to work,” it said.
The RP’s affidavit comes after the lessor filed a contempt petition, alleging that Ajmera did not permit them to inspect the aircraft and did not maintain them as per court directions.