Bankrupt Go First Seeks Up To $122 Million In Additional Funds: Report

Go Airlines, which operates under the brand Go First, has applied to the NCLT for resolution and protection under Section 10 of the Insolvency and Bankruptcy Code

Crisis-hit Go First, which is under bankruptcy protection as it tries to resume operations, has sought additional funds at a lenders meeting on Wednesday, citing banking sources news agency Reuters said. According to the report by the news agency, the airline is asking for between Rs 4 billion and Rs 6 billion ($122 million) in additional funds, the sources told Reuters, with lenders expected to evaluate proposals in the next 48 hours. None of the bankers wished to be identified because they were not authorised to speak to the media.

Go First plans to resume operations in July and operate 78 daily flights with 22 aircraft, one of the bankers said, adding that the airline will also require approval from aviation regulator DGCA. The planned resumption of operations depends on a number of factors including regulatory approvals, a second banker said.

The Go First bankruptcy filing lists Central Bank of India, Bank of Baroda, IDBI Bank, and Deutsche Bank among its creditors, which are owed Rs 65.21 billion in total.

Central Bank of India Ltd, Bank of Baroda, IDBI Bank Ltd and Deutsche Bank are among Go First's financial creditors, a court filing shows. Central Bank of India has said its exposure to the airline, at 0.91 per cent of its total advances, was Rs 13.05 billion by the end of March, with an additional Rs 6.82 billion sanctioned under a government-backed emergency credit guarantee scheme. The company owes financial creditors Rs 65.21 billion ($798 million), its bankruptcy filing showed, and had not defaulted on any of those dues by the end of April.

Go Airlines, which operates under the brand Go First, has applied to the NCLT for resolution and protection under Section 10 of the Insolvency and Bankruptcy Code "due to the ever-increasing failure of the Pratt & Whitney engines that power its fleet", the statement said.

Having faced engine problems since January 2020, the airline has revealed that it has had to take its case to the NCLT as Pratt & Whitney (P&W) has refused to abide by an order from the Singapore International Arbitration Centre (SIAC) emergency arbitrator.

The emergency arbitrator had instructed P&W to take all necessary actions to provide the airline with at least 10 serviceable spare leased engines by April 27, and another 10 per month until December 2023. This information was disclosed in a statement by the airline.