SpiceJet MD Ajay Singh and Busy Bee Airways Jointly Bid For Go First Airline In May last year, Go First filed for voluntary insolvency resolution proceedings before the National Company Law Tribunal
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SpiceJet MD Ajay Singh and Busy Bee Airways Private Ltd (BBAPL) have jointly submitted a bid for insolvent airline Go First. The bid is a "significant strategic move (with the) potential to reshape the landscape of the Indian aviation sector", SpiceJet said. The bid has been submitted by Singh in his personal capacity, the airline said.
Under the terms of the offer, SpiceJet will be the operating partner for the new airline, and will provide staff, services, and industry expertise. The airline hopes to leverage established infrastructure and operational capabilities to achieve significant revenue expansion.
In his statement, Ajay Singh said Go First has "immense potential and can be revitalised to work in close synergy with SpiceJet, benefitting both carriers", and that "by strategically aligning flight schedules and destinations, SpiceJet and the new airline can capture a larger market share..."
Notably, travel tech company EaseMyTrip's co-founder and CEO Nishant Pitti is a majority shareholder in Busy Bee Airways.
What went wrong with Go First
In May last year, Go First filed for voluntary insolvency resolution proceedings before the National Company Law Tribunal in Delhi. In a detailed statement during that time, Go First said it 'had to take this step due to the ever-increasing number of failing engines' provided by manufacturer Pratt & Whitney.
According to the statement, the airline said it had been 'forced' to apply for insolvency since Pratt & Whitney had 'refused to comply with an award issued by an emergency arbitrator', according to which the engine operators had to supply 10 engines by April 27 and 10 more every month till December 2023. They also said that Pratt & Whitney had 'failed to provide any further serviceable spare leased engines.'
Entrepreneur India had spoken to various experts when this news came out to understand what led to this turbulent phase of the airline and if there was any way out. One of the experts, Shakti Lumba, former vice president of operations, IndiGo Airline said, "For some years, its auditors have highlighted their opinion of the airline not being capable as a going concern. The P&W engine issue is the straw that broke Go First's back. The process in NCLT is complicated and time consuming and to survive the airline will need an emergency ingestion of cash, a compromise with P&W and relief from creditors."
To know more about this, read here: https://www.entrepreneur.com/en-in/news-and-trends/where-did-go-first-go-wrong-what-should-airlines-learn/451003
