Key Points
Go First, the first Indian airline to voluntarily seek bankruptcy protection, is reaching out to special-situation financiers such as asset reconstruction companies (ARCs) and distressed debt funds for short-term priority funding to ensure it takes to the skies again soon even if formal banking support is delayed...
The Insolvency and Bankruptcy Code (IBC) provides for priority funding after a company has been admitted in NCLT at higher rates..
Hence finding an alternative source of funds is necessary so that procedural issues do not impact the revival, leading to deterioration of assets, said a person aware of the discussions...
"If the plan works, then it can be repaid earlier with cheaper funds from banks replacing these lenders, said the second person, referring to the urgent need for funds..
"Ajmera has approached some funds and discussions are ongoing but given the history of Indian aviation and previous experiences of recovery it is unlikely that any major lenders will step forward..
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