Why EaseMyTrip's Nishant Pitti Is Keen on Buying Bankrupt Go First

About a month after the National Company Law Tribunal (NCLT) ordered the liquidation of bankrupt airline Go First, efforts to salvage the airline's brand are intensifying. And this time, UAE-based low-cost carrier FlyDubai has shown interest in it. 

According to a report by MoneyControl, Dubai government-owned airline FlyDubai is in discussion with India's Busy Bee Airways in its effort to buy Go First. 

Busy Bee Airways, which is owned by travel portal EaseMyTrip's co-founder Nishant Pitti, has long been involved in plans to acquire Go First. In late January, it filed a petition at the National Company Law Appellate Tribunal (NCLAT) to challenge the liquidation of the airline. 

Busy Bee's Bid to Acquire Go First

It’s been about two years since Go First's promoter, the Wadia Group, put the airline under the insolvency proceedings, citing engine failures caused by US-based Pratt & Whitney's International Aero Engines. The airline has Rs 6,521 crore in debt, with major lenders including Bank of Baroda, Central Bank of India, Deutsche Bank, and IDBI Bank. 

During the insolvency process, the committee of creditors of Go First reportedly received two revival plans. One was from Jaideep Mirchandani-owned Sky One Airways, and another by a consortium led by Nishant Pitti and SpiceJet Chief Ajay Singh. 

According to a Mint report, Pitti-led Busy Bee Airways offered Rs 1,800 crore for the troubled airline, with an upfront payment offer of Rs 500 crore. 

However, both withdrew their offers after NCLT ordered Go First's lessors to take away their aircraft. The NCLT order left the airline with no operational plans.  Now, Busy Bee Airways has re-entered the bid and is looking to partner with FlyDubai to launch a new airline in India. 

According to the latest MoneyControl report, Busy Bee is not interested in Go First's tangible assets, such as its massive land parcel in Thane, near Mumbai. They want to buy its flying rights, trademarks, and website. 

Why Go First Is Important?

Before filing for bankruptcy, Go First had a market share of about 6.9% in India's competitive civil aviation market, which is dominated by a few players. As of now, it is dominated by Air India and IndiGo.

In an interview with MoneyControl, Busy Bee owner Nishant Pitti said that he wants to revive Go First to help support the demand-supply gap in the Indian aviation market. He noted that it could be a “strategic move” given the sharp rise in Indian air travel. 

Further, Go First has substantial flying rights in domestic and international destinations, including Oman, Dubai, Thailand, Abu Dhabi, and Singapore. However, it was reported in May last year that the DGCA is planning to take away these airport slots. 

What Do Go First Creditors Want?

Go First's committee of creditors, as per their recommendation to the NCLT, see no revival in sight for the ailing airline. The CoC unanimously voted to liquidate the airline and has named Dinkar Venkatasubramanian as its liquidator.  

The CoC told the bankruptcy court that the resolution plans it received were neither compliant with the mandatory requirements of the IBC nor commercially acceptable. 

Later, during the hearing at NCLAT, Busy Bee said that it has submitted a proposal to the liquidator and key lenders, including the out-of-pocket banks controlling the Go First committee of creditors.