Wadia Group in talks with investors to jointly bid for Go First: Report

Wadia Group is in talks with financial investors to jointly bid for cash-strapped Go First airline, The Economic Times (ET) reported on Tuesday. The decision will, however, depend on whether the grounded airline will be considered airworthy again or not.

On Monday, the resolution professional (RP) invited Expressions of Interest (EOI) from investors. The last date for EOI has been fixed at August 9.

The Wadia Group earlier owned a 100 per cent stake in Go First through various entities owned by Nusli Wadia and his family. The airline has a total liability worth Rs 11,463 crore to all creditors.

Section 29A of the Insolvency and Bankruptcy Code (IBC) makes a person/entity ineligible to bid for an asset if declared a willful defaulter or if the person is a promoter of a company that has been classified as a non-performing asset (NPA) by banks.

However, an official quoted in the ET report said that the Wadia Group has not defaulted on any loans and is thus eligible to bid for the airline.

The group wants to hedge its bets in the aviation sector and thus wants to partner with a financial investor while holding a majority stake.

But the airline must start flying soon to preserve the value of its assets. "If the grounding is prolonged, then it becomes non-viable without assets such as parking slots and trained manpower," an official told ET.

On Monday, the Director General of Civil Aviation (DGCA) told the Delhi High Court that the lessors of Go First could not carry out maintenance work on the grounded aircraft. According to the aviation regulator, based on their records, Go First is the only entity authorised to maintain the aircraft.

If there was insufficient clarity regarding the maintenance responsibility, it could hinder the processing of Go First's revival plan, posing a safety concern, the DGCA said.