Ajay Singh, CMD of SpiceJet, along with Busy Bee Airways Pvt Ltd, has made a personal bid to revive the defunct GoAir. Jaideep Mirchandani’s Sky One has also submitted a bid for Go.
Previously, Ajay Singh bid for Air India during the government’s divestment process, which eventually returned to its founder Tata Group. SpiceJet has faced financial challenges for over two years, leading to delayed payments to stakeholders, including employees’ salaries, PF, and TDS. To cut costs, the airline plans to reduce its workforce by 15%.
Ajay Singh expressed confidence in GoFirst’s potential for revival, citing its valuable assets, including airport slots, traffic rights, and aircraft orders. He aims to leverage its strengths in synergy with SpiceJet for mutual growth.
Jaideep Mirchandani, Chairman of Sky One, affirmed their bid for GoFirst, expressing readiness for the due diligence stage. With their extensive global aviation experience, they are optimistic about the acquisition, seeing it as a contribution to India’s burgeoning aviation sector.
Go First ceased operations on May 3, 2023, due to financial challenges, notably stemming from Pratt & Whitney engine issues, and is now in the process of insolvency resolution.
SpiceJet’s CMD Ajay Singh and Busy Bee Airways, primarily owned by EaseMyTrip CEO Nishant Pitti, jointly submitted a bid for Go First airlines on Friday, February 16.
This initiative is separate from EaseMyTrip, which is concentrating on its own strategic objectives and expansion strategies.
SpiceJet will serve as the operational collaborator for the upcoming airline, offering crucial services, personnel, and industry knowledge. “Through the strategic synchronization of their flight schedules and destinations, SpiceJet and the new airline can secure a greater market share and effectively address diverse passenger requirements,” SpiceJet stated in a stock exchange filing on Friday, February 16.
Additionally, Sharjah-based airline Sky One Airways has submitted the second bid for Go First.
Moreover, the National Company Law Tribunal (NCLT) extended the deadline by 60 days on February 13 to complete Go First’s resolution process. A two-member bench of the NCLT in Delhi granted the request filed by Go First’s resolution professional (RP) seeking more time to finalize the corporate insolvency resolution process (CIRP).
Meanwhile, SpiceJet is currently executing a revival plan, having concluded the first tranche of capital injection totaling ₹744 crore, with further subscriptions awaiting regulatory clearance.
Furthermore, the company has commenced the procedure to secure an additional ₹1,000 crore. SpiceJet already possesses shareholder approval to raise up to ₹2,500 crore through Qualified Institutional Placement (QIP), eliminating the necessity for additional shareholder consent.
On the stock market, SpiceJet shares surged by 11.28% to ₹70.81 each, while Easy Trip Planners shares saw a 1.27% increase, closing at ₹49.05 per share.
Collaborative Efforts and Strategic Results
The bidding process for Go First is generating considerable anticipation, with far-reaching implications for various stakeholders. Ajay Singh’s potential acquisition, along with his consortium, could bring about a major transformation in India’s aviation landscape, revitalizing Go First and propelling SpiceJet to greater success. The strategic rationale behind this move, focusing on operational efficiencies and market expansion, could influence future industry consolidations. Additionally, Sky One’s competing bid adds intrigue, hinting at possible cross-border collaborations.
In summary, the ongoing saga of Go First’s insolvency resolution reflects the complexities and opportunities within the aviation industry. As stakeholders await the outcome, bids from Ajay Singh and Sky One underscore the diverse strategies to navigate challenges and seize opportunities amid economic uncertainty. With the prospect of significant synergies and growth, the result of this bidding war could reshape Go First’s trajectory and redefine India’s aviation landscape.
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