SpiceJet Founder and Partner Bid $72.4 Million for Go First, Plan Asset Sales

SpiceJet’s founder Ajay Singh and business partner Nishant Pitti, co-founder of EaseMyTrip, have reportedly submitted a bid of INR6 billion (USD72.4 million) to acquire the insolvent airline Go First. The bid includes an upfront payment of INR2.5 billion (USD30.1 million), with plans to monetize Go First’s assets, including valuable real estate holdings in Mumbai valued above the INR62 billion (USD747.4 million) in admitted creditor claims against Go First.

The strategic bid by Singh and Pitti also suggests invoking corporate guarantees by Go First’s current owner, the Wadia Group, to offset creditor claims. They aim to leverage the USD300 million awarded to Go First from Pratt & Whitney disputes to further reduce the airline’s debt. The grounding of Airbus A320neo aircraft due to engine failures significantly contributed to Go First’s financial distress, leading to its flight suspension in May 2023.

Additionally, the potential buyers are considering selling numerous slot pairs at Indian airports to meet high demand at key locations. While planning to restart Go First’s operations, the revived airline would operate on a smaller scale, necessitating negotiations for new aircraft leases, as lessors have sought to repossess Go First’s entire fleet of 54 leased aircraft following its insolvency.

Singh has disclosed a net worth of approximately INR90 billion (USD1.08 billion), with a valuation of his SpiceJet stake at around INR50 billion (USD602.7 million). Pitti has reported his net worth at INR38 billion (USD458 million), holding a 28% stake in EaseMyTrip.

Sharjah-based Sky One has also expressed interest in acquiring Go First, with its chairman Jaideep Mirchandani citing India’s growth prospects as a key motivator and expressing confidence in their aviation expertise globally.

Due diligence on the bids is currently in progress, with further updates anticipated in the latter half of March. This development marks a significant moment in the restructuring of India’s aviation sector, with potential implications for the competitive landscape and operational dynamics.