EaseMyTrip Nishant Pitti Fights to Revive GoFirst, Opposes Airline Liquidation!
EaseMyTrip : Nishant Pitti, co-founder of EaseMyTrip, is considering selling a stake in the travel aggregator, but he is also showing a strong interest in acquiring the bankrupt GoFirst. Pitti’s company, Busy Bee Airways, has recently intensified its efforts in the National Company Law Appellate Tribunal (NCLAT) by advocating for a revised resolution plan for GoFirst and challenging the airline’s liquidation.
GoFirst voluntarily entered into insolvency proceedings in 2023, which led to the appointment of a resolution professional (RP) by the National Company Law Tribunal (NCLT). Busy Bee, supported by Pitti, and SpiceJet Chairman Ajay Singh, jointly submitted a bid for GoFirst, which was unfortunately rejected by the RP in July 2024.
Subsequently, the Delhi High Court granted permission for the deregistration of aircraft, allowing lessors to reclaim their assets. As a result, the Committee of Creditors (CoC) decided to proceed with the liquidation of the airline, a decision that was confirmed by the NCLT on January 20. Busy Bee Airways has since contested this order.
In its appeal, Busy Bee argues that it should be given the opportunity to present a revised resolution plan for GoFirst, emphasizing the importance of maintaining the airline for the benefit of the nation. The petition warns that the liquidation of GoFirst would result in higher airfares, reduced competition, and limited choices for consumers. Additionally, it highlights the impact on the more than 4,800 employees who would be affected by the airline’s closure.
The petition has raised concerns about the RP’s failure to provide comprehensive details regarding the assets, liabilities, and financial status of the airline. Criticizing the RP’s actions, the plea argues that the lack of transparency and non-disclosure of crucial information prevented the consortium, including Busy Bee, from submitting a well-informed resolution plan.
The petition holds the RP responsible for neglecting the resolution process and pushing the company towards premature liquidation. It references a previous ruling by the Supreme Court in Swiss Ribbons, emphasizing that liquidation should be a last resort. Busy Bee’s plea asserts that resolution would maximize value, benefiting all stakeholders involved.
With the only remaining asset being an arbitral award against Pratt and Whitney, Busy Bee argues that GoFirst should not be liquidated. The company voluntarily entered IBC proceedings in 2023, with the NCLT admitting it into insolvency and appointing an RP. Despite a joint bid by Busy Bee and SpiceJet Chairman Ajay Singh being rejected in July 2024, the Delhi High Court allowed aircraft deregistration, leading to the CoC’s decision to liquidate the airline.
Busy Bee Airways has challenged the NCLT’s order for liquidation, advocating for the submission of a revised resolution plan to revive the defunct airline. The petition stresses the importance of preserving the airline in the national interest, warning that its liquidation would result in higher airfares, reduced competition, and limited choices for consumers. Additionally, it highlights the impact on over 4,800 employees if GoFirst were to be liquidated.
For more market insights, follow our blog.
Stay tuned for more updates and insights on the stock market! For more insights on investing in the Indian stock market, check out resource like ET, NSE India.
Disclaimer: This blog post is for informational purposes only and should not be considered financial advice. Investors should conduct thorough research and consult with a qualified financial advisor before making any investment decisions.