According to sources familiar with the matter, Indian conglomerate Wadia Group is in talks with potential strategic partners to sell a majority stake or completely exit its budget airline, Go First, as reported by The Economic Times.
Notably, the budget airline has been struggling with operational problems in recent months, with half of its aircraft grounded due to supply chain disruptions related to Pratt & Whitney (P&W) jet engines.
Go First posted its biggest annual loss in fiscal 2022, further complicating its financial outlook.
Reluctance to Invest More Amidst P&W Engine Woes
In the last 15 months, the Wadia Group has invested approximately 30 billion rupees ($366.2 million) to keep the airline afloat. However, sources say the group is hesitant to invest more money until the P&W engine problem is resolved. The Wadia Group owns Bombay Dying & Manufacturing Co Ltd, a textile manufacturer.
Go First and Wadia Group Yet to Comment on the Matter
As of this writing, Go First and Wadia Group have not responded to Reuters’ request for comment. Despite the surge in domestic air traffic, Go First, owned by the Wadia Group, experienced a decline in market share in February, according to the latest available official data.
Plans for Initial Public Offering (IPO) Derailed
Go First had previously filed for an initial public offering (IPO) in May 2021. However, the airline’s plans were hampered by the impact of coronavirus outbreaks and issues related to P&W engines, as reported by ET.
(With Inputs From ET)
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