Go First Receives Expressions of Interest from Three Potential Buyers

India’s troubled airline, Go First, has seen a glimmer of hope as three entities have submitted formal expressions of interest (EOIs) to acquire the insolvent budget carrier. This development has prompted the airline’s committee of creditors (CoC) to consider applying for an extension of time with India’s National Company Law Tribunal (NCLT) to facilitate the sale process.

The move to seek an extension is aimed at allowing sufficient time for due diligence by the potential buyers, enhancing the prospects of achieving a better outcome for the creditors compared to liquidation. According to Reuters, the CoC is motivated by the opportunity to recover more from the sale of the airline, which ceased operations in May 2023, amidst financial turmoil.

India’s insolvency framework provides a maximum of 330 days for the sale of a distressed company. As of early February, the clock is ticking with approximately 60 days remaining to conclude a deal. Go First’s financial woes include admitted debts exceeding INR62 billion (USD748 million), highlighting the urgency and significance of securing a viable buyer.

The interested parties include the recently recapitalised SpiceJet, Sharjah-based Sky One, and an entity known as Busy Bee, which has connections to the Plan It consortium, previously considered a potential acquirer. Each of these entities has complied with the requirement to submit an INR50 million (USD603,000) bank guarantee alongside their EOIs, marking a serious intent to pursue the acquisition.

The decision to extend the timeline for the sale process necessitates agreement on a new deadline by the CoC and formal approval by the NCLT. The CoC is reportedly convening to determine the next steps, with the expectation that the administrator will soon approach the NCLT to finalize the extension.

This development offers a ray of hope for Go First, providing a pathway towards resolution and potentially marking a new chapter for the airline under new ownership. The involvement of credible bidders underscores the interest in Go First’s assets and operational potential, despite its current financial challenges.