KOCHI: Over two years since Federal Bank took possession of a seaplane after a Kochi-based company defaulted on a Rs 6 crore loan, the bank is struggling to find a new buyer for the aircraft and recover the lost money.
The Aluva-headquartered private bank acquired the aircraft from Seabird Seaplane Ltd, invoking the provisions of the Insolvency Code, in a much-publicised event in October 2019. "The seaplane does not have flying licence/permits, and this may be the reason for the lack of interest from potential buyers," an official of Federal Bank told The New Indian Express.
He said the entire auction process was being done by the Insolvency and Bankruptcy Code (IBC).
Founded by Kochi-native Captain Suraj Jose, who quit a full-time pilot instructor's job to float Seabird Seaplane, the company's objective was to provide seaplane services from Kochi airport to Lakshadweep and Andaman and Nicobar Islands. But, Seabird Seaplane Ltd, founded in 2013, did not take off as it failed to get various approvals from the Directorate General of Civil Aviation and other authorities.
For the auction of the 'Quest Kodiak' aircraft, manufactured by P&W Canada, the IBC has put a reserve price of about Rs 5.45 crore. A source in the bank said it's no surprise that the company folded up as it could not get the required permissions to fly even after six years.
Reportedly, the company paid over Rs 15 crore (including import duties) for the eight-seater aircraft, besides paying the parking fees to Cochin International Airport Ltd (CIAL). Two years ago the seaplane parked in CIAL was taken under custody by Insolvency Professional Jose KK, appointed by the National Company Law Tribunal.
While taking the aircraft under custody, the bank was confident of getting at least Rs 8 crore, given that the amphibious aircraft had a market rate of Rs 13 crore. "A buyer who is capable of getting the required approvals can get the aircraft for a song," said the official.