 "Go First lenders likely to recover Rs 1,600-1,900 cr through Thane land")
The lenders of airline Go First are seeking to recover around 25-30 per cent or Rs 1,600 crore-Rs 1,900 crore of their exposure to the airline. A senior banker said that this would come from the land in Thane that the Wadia group has given as collateral to the banks, according to a report in the Financial Express (FE).
Go First, which stopped its flying operations from May 3 this year, is undergoing an insolvency resolution process under the Insolvency and Bankruptcy Code (IBC). The airline owes Rs 6,521 crore to the lenders, including the Central Bank of India, the Bank of Baroda, the Deutsche Bank, and the IDBI Bank.
According to the FE report, the recovery of 25-30 per cent is a little less than what the financial creditors have realised from the IBC process in FY23 at 36 per cent. In the last couple of years, the recovery has improved from 17 per cent in FY21 and 23 per cent in FY22.
Kaushik Khona, chief executive officer of Go First, had said that the value of 94 acres of land is Rs 3,000 crore.
In November last year, the aviation sector regulator informed the Delhi High Court that the government directive exempting aviation leases from bankruptcy moratorium should be applicable even to companies undergoing insolvency proceedings.
A lender said, “Everything depends on the judgment of the Delhi High Court. If the High Court judgment comes that the lessors can take the aircraft, then nothing will be left for us, and liquidation will be the only option. Without aircraft, there will be no airline.”
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In a meeting on Tuesday, the Committee of Creditors (CoC) of Go First decided to extend the deadline by 90 days for the resolution under the Corporate Insolvency Resolution Process and not to release more funds to the airline.
The senior banker said, “We have agreed for the 90-day extension for the resolution, now the RP (Resolution Professional) will file a formal application with the National Company Law Tribunal.”