Lenders to Go First Airlines replaced key bankruptcy-related officials appointed by the company that took itself to National Company Law Tribunal (NCLT), indicating their intent of controlling the carrier's resolution process at the NCLT and to avoid any conflict of interests.
The committee of creditors (CoC) replaced the company-appointed interim resolution professional (IRP) Alvarez & Marsal (A&M)’s Abhilash Lal and appointed Ernst &Young (EY)-backed Shailendra Ajmera. Sources close to the matter told DH that EY has replaced A&M as process advisor while J Sagar Associates (JSA) have been brought as the legal advisor to CoC.
“Most of these professionals and firms appointed as key bankruptcy officers were on the suggestions of Go First Airlines. CoC seeks to replace all of them in order to avoid any minute possibility of conflict of interest. Thus, any professional or firm that has served the promoters or management of GoFirst even remotely in the past is being replaced,” said a legal source close to the matter.
“CoC can change the Resolution Professional (RP) at any time during the CIRP, the power has been given in Section 27 of IB Code. Now that COC has, in its commercial wisdom, appointed Mr. Ajmera as the RP, approval from NCLT would be a routine process,” said Pratul Pratap Singh, an advocate associated with the matter.
The CoC is also expected to file more changes before the NCLT by Tuesday. Sources close to the matter suggested the CoC might also request to expedite the appointment of IRP as the matter is listed for arguments on June 15 where the NCLT will also hear arguments on the three interim applications on issues concerning restraining the flying of aircraft for commercial use, inspection of engines and modification of the May 10, 2023 order in respect of the aircraft owned.
“In times to come, we could see a restructured plan for financial deliverables to creditors, assimilating all claims together,” suggested Bharat S Kumar, Associate Partner, Saikrishna & Associates. "There could be some capital infusion too and the government would not want an airline with over a 5% share to collapse," he added.