Lenders to India's Go First weigh liquidation after court order on planes, sources say (updated)

Central Bank of India

30/04/2024 11:25

(Updates with fresh comments from Sky One in paragraphs 8-9)
    By Siddhi Nayak
       MUMBAI, April 30 (Reuters) - Lenders to India's Go First
will meet this week to discuss options for the bankrupt airline,
including liquidation, after a court order allowed lessors to
take back their planes, two bankers with Go First's creditors
said on Tuesday.
    "There is no value left in the airline after the court order
and chances of revival seem very grim," one of the bankers said.
        Go First's resolution professional did not immediately
respond to a Reuters' email seeking comment.
    The airline owes a total of 65.21 billion rupees ($780.88
million) to its creditors, which include Central Bank of India
 CBI.NS , Bank of Baroda  BOB.NS , IDBI Bank  IDBI.NS  and
Deutsche Bank  DBKGn.DE .
    The Committee of Creditors (CoC) met on Monday and another 
meeting is scheduled for Thursday, both sources said.   
    The two bankers did not wish to be identified because they
are not authorised to speak with the media.
    Go First has received two bids under the formal bankruptcy
process - one from a consortium which includes budget carrier
SpiceJet's managing director Ajay Singh and Busy Bee Airways,
and the second from Sharjah-based Sky One, Reuters previously
reported.
    Sky One's Chairman Jaideep Mirchandani said that despite the
deregistration of leased planes, the company was prepared to
bring in their own assets and resources to revive the airline,
if its bid was successful.
    "Our extensive experience as lessors and our comprehensive
portfolio of aviation services uniquely position us to address
the challenges and opportunities presented by Go First's
situation," Mirchandani said in an emailed response to Reuters.
    Ajay Singh and Busy Bee's majority shareholder Nishant Pitti
did not respond to emails seeking comment.
        Lenders may still choose to reject the bids on the table
as they are not happy with the sums offered currently by both
applicants, the second banker said. 
    The bids include the value of a piece of land offered as
collateral by the airline's promoters, the banker said.
    Reuters had earlier reported that lenders had sought higher
bids.
    While liquidation seems to be the most viable option under
the present circumstances, it will be put to a vote once the
committee formally rejects the two offers or if the applicants
back out, both the bankers said.

        
($1 = 83.5080 Indian rupees)

 (Reporting by Siddhi Nayak; Editing by Sonali Paul and Emelia
Sithole-Matarise)
 ((Siddhi.Nayak@thomsonreuters.com; +91 22 6921 7848; Reuters
Messaging: Twitter: https://twitter.com/siddhiVnayak))