Adani Group Confirms Acquisition of 74% Stake in MIAL

Adani Group Confirms Acquisition of 74% Stake in MIAL

Following last week’s reports of the Adani Group potentially acquiring a 74% stake in Mumbai International Airport Limited (MIAL), Adani Airport Holdings Ltd (AAHL) has now confirmed the news in a regulatory filing. AAHL is a subsidiary of the Adani Group focusing primarily on its airport business. 

The firm run by billionaire Gautam Adani will acquire 50.5 per cent of GVK Power and Infrastructure Ltd’s stake in the airport, while an additional 23.5 per cent of the stake will be acquired by foreign investors including the Bidvest Group and Airports Company South Africa (ACSA). This move will effectively make AAHL the country’s largest private airport operator.

“The GVK Group and AAHL have agreed that AAHL will offer a stand-still to GVK, in addition, to release the guarantee given by GVK Power and Infrastructure Ltd with respect to the debt acquired by it,” AAHL said in a regulatory filing. 

Elaborating on the acquisition of the 23.5 per cent stake from the aforementioned foreign companies, the Adani Group mentioned that it has obtained the requisite permissions for this from the Competition Commission of India (CCI).

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“Upon the acquisition of the debt of GVK ADL, Adani Group will take steps to obtain necessary customary and regulatory approvals, as may be required, to acquire controlling interest in MIAL,” the company added.    

GVK said in its filing that the Adani Group will acquire its debt from lenders such as HDFC as well as a consortium led by Goldman Sachs. The company added that the debt will be converted into equity at terms agreed upon beforehand. However, neither company divulged financial details of the acquisition.

Founder and Chairman of GVK, GVK Reddy, said, “The aviation industry has been severely impacted by COVID-19, setting it back by many years and has impacted the financials of Mumbai International Airport Ltd.”

“It was therefore important, that we bring in a financially strong investor in the shortest possible time to improve the financial position of MIAL, as well as to help achieve financial closure of the Navi Mumbai International Airport project, which is a project of national importance,” Reddy added.

As expected, the Adani Group’s involvement in MIAL will also provide financial assistance to the Navi Mumbai International Airport so as to begin construction on the project at the earliest. In addition to the newly acquired stake in MIAL, Adani Group is also expected to run six non-metro airports of the country including Ahmedabad, Guwahati, Jaipur, Lucknow, Mangalore, and Thiruvananthapuram. 

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