Go First’s RP Shailendra Ajmera seeks Rs 425 crore in interim finance to restart airline
Go First’s resolution professional Shailendra Ajmera has sought Rs 425 crore in interim finance from the airlines financiers to get a revival plan going that could help restart operations, according to multiple sources.
The requirement for financing could expand based on certain contingencies such as the availability of working engines for the aircraft and ticket cancellations, the sources said.
It therefore came as a shock when Go First this month filed for insolvency and grounded flights, blaming the US engine maker Pratt & Whitney for the debacle.
The company said its financial troubles were “due to the ever-increasing number of failing engines supplied by Pratt & Whitney”. It accused the manufacturer of refusing to supply usable engines under an emergency arbitration award that resulted in cash flow issues.
The airline this month said the “grounding of close to 50 per cent of its A320neo fleet due to the serial failure of Pratt & Whitney’s engines, while it continued to incur 100 per cent of its operational costs, has set Go First back by 108 billion rupees ($1.3 billion) in lost revenue and additional expenses”.
Pratt & Whitney has rejected the claims.
In a filing on Thursday, International Aero Engines (IAE), in which Pratt is a shareholder, said the “risks for IAE, which were high to begin with, have increased significantly since Go First’s bankruptcy”.
It accused the carrier of not paying maintenance charges, describing it as an “insolvent airline that materially breached its contractual obligations”.
Go First is majority owned by Wadia Group, which is also known in India for its cookie brand Britannia and its textile company Bombay Dyeing.
