Ajay Singh, boss of struggling SpiceJet that laid off people to stay aloft, bids for GoFirst
SpiceJet's Ajay Singh and Busy Bee Airways collaborate for GoFirst airline bid.
SpiceJet's managing director, Ajay Singh, and Busy Bee Airways have jointly submitted their bid for GoFirst airline, SpiceJet said on Friday.
Weighed down by financial troubles, Go First ceased operations in May last year and is currently undergoing an insolvency resolution process.
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How will the GoFirst deal affect SpiceJet?
In a statement on Friday, SpiceJet said that the bid was submitted by its chief Singh in a personal capacity.
SpiceJet will be an operational partner for the new airline. It will supply essential staff, services, and industry expertise.
"This collaboration is anticipated to generate synergies between the two carriers, leading to improved cost management, revenue growth, and a strengthened market position within the Indian aviation industry," the statement said.
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Why is Ajay Singh placing his bet on GoFirst?
Ajay Singh, who is the chairman and managing director of SpiceJet, believes that GoFirst has a lot of potential and by working closely with SpiceJet, both airlines can benefit.
"Apart from coveted slots at domestic and international airports, international traffic rights, and an order for over 100 Airbus Neo planes, GoFirst is a trusted and valued brand among flyers. I am happy to contribute to the efforts aimed at reviving this popular airline and leveraging its strengths for mutual growth and success," he said in the release.
Having filed for bankruptcy in May last year, GoFirst is currently indebted to its creditors, including Central Bank of India, Bank of Baroda, IDBI Bank, and Deutsche Bank, with a total owed amount of ₹6,521 crore.
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SpiceJet shares jump
SpiceJet shares experienced significant buying activity during Friday's trading session. The share price opened higher today, reaching an intraday peak of ₹71.90 each, marking a notable 13 per cent increase from Thursday's closing price of ₹63.63 on the National Stock Exchange.