Grounded irline Go First has received an expression of interest (EoI) from Jindal Power Ltd, said a report on Thursday.
An EoI is the first step in the bidding process and may not result in a financial bid. Faced with financial headwinds and engine woes, budget carrier Go First stopped flying on May 3 and is undergoing an insolvency resolution process.
“Jindal Power was the sole successful applicant whose expression of interest was accepted by banks,” a banker with a PSU bank that has exposure to Go First told Reuters.
The power generation company “will be conducting proper due diligence and post which it could submit a formal bid”, said the banker, who did not wish to be named as he was not authorised to speak to the media.
The last day to submit EoIs was September 28, the banker said, and a committee of lenders met to assess the applications after that.
Two other foreign entities had also submitted EoIs to bid for Go First, but their applications were rejected for failing to meet the criteria set by lenders, another banker said.
Go First’s resolution professional, who conducts the insolvency process, and Jindal Power did not immediately respond to Reuters’ requests for comment.
The Go First bankruptcy filing lists Central Bank of India, Bank of Baroda, IDBI Bank and Deutsche Bank among its creditors to whom the carrier owes a total of Rs 6,521 crore.
Aircraft lessors of Go First are locked in a legal tussle with the company after they were blocked from repossessing planes due to a moratorium imposed by Indian courts.
However, the government amended its insolvency law earlier this month to exclude leased aircraft from assets that can be frozen, to bring bankruptcy laws into line with a treaty protecting the rights of foreign lessors.
It is unclear whether the amended law would apply to Go First since its insolvency proceedings are still underway.
With inputs from Reuters
