Go First seeks emergency funding of Rs 100 crore from creditor banks

Go First airlines’ resolution professional (RP) is seeking a funding of Rs 100 crore from its lenders to help keep the company afloat by meeting its operational expenses, according to a report by the Economic Times. RP Shailendra Ajmera, backed by EY, informed lenders in the committee of creditors (CoC) that the emergency funds would go towards mandatory liabilities such as insurance and repairs necessary to sustain operations

Sources informed ET that requests were made from banks based on their voting share within the CoC.

Bank of Baroda and Central Bank of India cumulatively hold 72 per cent of the voting share, Deutsche Bank holds 25 per cent, and IDBI Bank holds the remainder. A request has reportedly gone to the corporate offices of the Central Bank and Bank of Baroda, and a decision is expected in a few days. 

According to a report by Business Today, Deutsche Bank told the RP that it had settled its loans with the promoter, Wadia Group. Moreover, the bank wants to relinquish its membership in the CoC. While Deutsche Bank had filed a Rs 1,365-crore claim as unsecured creditors, it has not been disclosed how the debt was settled.

The airline had filed for bankruptcy in May, claiming that nearly half of its 54 Airbus A320neos had “faulty” engines. Pratt & Whitney, the engine makers, had responded that the airlines’ financial situations were unrelated to the engines.

The Delhi High Court recently allowed aircraft lessors to inspect the planes they lent to the airline. A division bench of the court also upheld this decision.