Jindal Power scraps plan to bid for bankrupt Go First

New Delhi: Jindal Power has decided not to go ahead with its plan to bid for Go First, which is undergoing an insolvency resolution process, according to industry sources.

Budget carrier Go First stopped flying in early May and filed for voluntary bankruptcy proceedings amid financial woes, mainly triggered by engine issues.

Last month, Jindal Power had put in an Expression of Interest (EoI) for the bankrupt airline. It was submitted to get details about the valuation of the assets and documents.

Jindal Power is not going ahead with its plan to bid for Go First, the industry sources said on Tuesday.

There was no official comment from the company.

In October, regional carrier Jettwings Airways had announced putting in a preliminary bid for Go First.

Meanwhile, various aircraft lessors have launched legal battles to repossess planes leased to Go First.

Against this backdrop, the government, in October, exempted aircraft objects registered in the international registry from the applicability of the moratorium under the Insolvency and Bankruptcy Code (IBC).

Earlier this month, the Directorate General of Civil Aviation (DGCA) said the amendment in the insolvency law that exempts aircraft objects from the ambit of moratorium will be applicable retrospectively.

Aircraft are the core assets for an airline and once lessors start repossessing the planes, the valuation of Go First as a going concern will be significantly reduced.