Go First, formerly known as Go Air, aims to restart its operations by May 24 after it was granted bankruptcy protection by the National Company Law Tribunal (NCLT) on Wednesday.
However, the budget carrier faces several roadblocks as at least one of its lessors, SMBC Aviation Capital, has appealed against the NCLT’s decision allowing Go First’s voluntary insolvency plea.
What Happened: Go First plans to restart flights within two weeks with about 24 aircraft and a smaller operation, Economic Times reported, citing sources familiar with the matter.
Go First had filed for voluntary insolvency proceedings after half its fleet was grounded allegedly due to the non-supply of spare engines by aerospace manufacturer Pratt & Whitney.
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The NCLT on Wednesday granted the Wadia Group-owned airline bankruptcy protection, temporarily preventing attempts by lessors and lenders to recover their assets from the troubled airline for the time being. The ruling also effectively placed a moratorium on the travel firm’s financial obligations to lenders.
The decision will also allow Go First to attempt to revive the debt-ridden airline under the supervision of an interim resolution professional (IRP).
However, SMBC Aviation Capital, one of the world’s largest aircraft-leasing firms has challenged the ruling and said in its appeal that admitting Go First’s petition would deal a blow to the international aviation industry’s confidence in India’s airline sector.
With Go First now under bankruptcy protection, several stakeholders in the industry, including lessors, lenders and competitors, will likely be affected either positively or negatively.
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