Naveen Jindal-owned firm expresses interest in buying out Go First
Naveen Jindal, the promoter of Jindal Steel and Power, has expressed interest in buying insolvent airline Go First. Go First is India’s first commercial carrier to have voluntarily sought bankruptcy protection. Jindal Steel & Power is a non scheduled operator permit holder (NSOP, charter operator). It has a nine-seater Cessna 560XL aircraft.
Go First suspended operations on May 2, 2023, and its unpaid-for-months employees are getting increasingly restive due to a radio silence on the salary issue. The moratorium period provided by India’s bankruptcy law, that has allowed GoAir to hold on to 45 leased aircraft, engines and other assets like foreign bilaterals, is soon going to be over.
A recent government of India order keeping transactions, arrangements or agreements relating to aircraft, aircraft engines, airframes and helicopters out of the moratorium provisions of IBC will take that protection from Go Air.
Over the past few months, a large number of GoAir pilots have joined Air India Group and IndiGo. Now, it has about 150 pilots left. If this time also nothing works out, then the remaining few could also leave. There are still about 3,000 direct employees who are upset at being left high and dry when it comes to salary payment even during this festive season.
GoAir has received claims worth Rs 24,500 crore from operational and financial creditors. Of the Rs 24,500 crore, financial creditors have claimed Rs 5,111 crore. Most of the claims pertain to operational creditors like travellers, ticket booking agencies, etc.
Lessors have filed multiple cases to repossess their aircraft and engines. This July, DGCA had conditionally accepted GoAir’s resumption plan by taking to the skies again with 15 aircraft to operate 114 daily flights, subject to getting funds to do so and cases pending with courts and the NCLT. However, a defunct airline is yet to revive in India.
Also Read: Govt keeps aircrafts, helicopters out of ambit of moratorium under IBC
