According to two banking sources who spoke to Reuters, Go Airlines (India) Ltd. has received claims totaling 23,777 crore ($2.9 billion) from both operational and financial creditors as part of its ongoing insolvency process.
When a business declares bankruptcy, this process complies with Indian law’s standards. It gives each creditor the opportunity to request payment and redress by making claims. The resolution specialist is then in charge of confirming the validity of these filed claims.
According to a banker with a state-run bank who has exposure to Go Airlines, claims from lenders are roughly Rs 5,000 crore. While lessors have made claims totaling 18,000 crore so far, according to Reuters. The remark was made on July 21 following a meeting of the committee of creditors.
The resolution specialist in charge of Go Airlines has not yet verified the veracity of the charges and did not instantly reply to an email from Reuters seeking comment.
Go Airlines, which oversaw the operations of Go First Airlines, filed for bankruptcy protection in May. They blamed the “faulty” Pratt & Whitney engines for the forced grounding of about half of its 54 Airbus A320neos.
The assertions are unfounded, according to the engine manufacturer controlled by Raytheon.
Investors were invited to show their interest in the company earlier in July by contacting a court-appointed administrator. Expressions of interest (EOI) from investors are due on August 9.
The second banker stated, “The airline has received 40 inquiries on EOIs from potential bidders, but no formal submissions have yet been made.”
Due to their lack of authorization to speak with the media, the bankers chose not to expose their identities.
On July 21, India’s aviation watchdog announced that Go Airlines might be able to restart operations if it can meet a few requirements. It includes obtaining temporary money and getting its route schedule approved.
The banker stated that the resolution professional is waiting for banks to release funds for which in-principle approval was granted last month in order to commence activities.
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