Go First’s RP says carrier needs Rs 425 cr in interim finance to restart operations: Report

Crisis-hit Go First’s newly appointed Resolution Professional Shailendra Ajmera has said that the airline needs Rs 425 crore in interim finance to restart its operations.

Ajmera has put up the proposal for funds to the Committee of Creditors of Go First at a meeting that took place earlier this week, a report in The Economic Times said. The Committee of Creditors includes the Central Bank of India, Bank of Baroda, IDBI Bank and Deutsche Bank.

The report added that the requirement for financing could expand based on certain contingencies such as the availability of working engines for the aircraft and ticket cancellations.

Go First plans to resume operations in July and operate 78 daily flights with 22 aircraft, a Reuters report said earlier this week.  

The planned resumption of operations depends on a number of factors including regulatory approval.

The Directorate General of Civil Aviation (DGCA) has to give its approval for the airline to restart operations. That go-ahead is subject to the availability of financing for the airline.

Go First has cancelled flights until June 28 due to 'operational reasons'. In a Twitter post on Saturday, Go First said: "Due to operational reasons, Go First flights until 28th June 2023 are cancelled," the airline said in a tweet and apologised for the inconvenience caused to the flyers.

Go First had suspended its operations from May 3 attributing the decision to problems with engines provided by Pratt & Whitney. Following this, the cash-strapped carrier, which had been flying for more than 17 years, filed for voluntary insolvency resolution proceedings before the National Company Law Tribunal (NCLT) on May 2 and the plea was admitted on May 10.

Earlier this month, the airline submitted a revival plan to the DGCA under which it has proposed to resume operations with a fleet of 26 aircraft.  

Go First has undrawn limits of about Rs 200 crore under the Central government’s Emergency Credit Line Guarantee Scheme (ECLGS), which was introduced to support sectors like travel and tourism that were adversely impacted by the pandemic.

Last week, lenders voted to appoint Ajmera from KPMG as the Resolution Professional.

The report said that if the airline gets the necessary approvals, it can then operate chartered flights between Delhi-Srinagar and Delhi-Leh within 48 hours by deploying two aircraft. Thereafter it will be able to resume scheduled services, mainly on the Leh, Srinagar, and Chandigarh routes.

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