Go First establishes company with former employees to liaison with lessors amid resolution process

Facing legal actions from plane leasing firms due to non-disclosure of aircraft documents, the bankrupt airline Go First has begun working with ex-employees to engage with these companies, says a report by Economic Times. Go First has set up SP Mumbai Aviation, led by Sachin Naik, previously part of their finance team. According to a communication by the resolution professional of Go First, this move was made by a few former employees of the company to collate aircraft documents. The message suggested that Go First could potentially, through Naik, facilitate discussions with Maintenance, Repair, and Overhaul companies for essential airplane maintenance based on requirements identified in the records.

While the development has been accepted by most lessors, a solicitor representing one lessor raised concerns. The attorney commented that this unusual move is a reaction to a contempt lawsuit, due to the lack of manpower at Go First, making it unable to maintain the planes. Most lessors have accepted this three-party agreement to safeguard their airplanes. However, as the airline lacks the funds and manpower, the lessors will shoulder the maintenance expenses to avoid plane degradation.

Go First, along with SP Mumbai Aviation, its parent company Wadia Group, and the resolution professional did not answer any inquiries regarding the matter, according to the report.

Go First has to deal with dissatisfaction amongst lessors while searching for an investor bid within India’s bankruptcy courts. It also has a legal dispute with engine manufacturer Pratt & Whitney, which Go First blames for their financial troubles. DAE (SY22) 13 Ireland Designated Activity Company, a division of DAE Capital, filed a contempt lawsuit in the Delhi High Court against Go First, accusing it of not complying with court orders.

Although three entities, including Sky One, Safrik Investments, and competitor SpiceJet, have shown interest in purchasing Go First, no substantial bids have been made yet. The airline, which was approved for a corporate insolvency resolution last year, faces financial troubles, legal disagreements, and the crucial task of addressing the concerns of lessors during ongoing bankruptcy proceedings.