GMR to divest more in airport arm, to sell 49% to GIC, Tata Group and SSG Capital

Updated : January 16, 2020 02:22 PM IST

Stake sale in GMR Airports will be to TRIL Urban Transport, a part of Tata Group, an affiliate of GIC and SSG Capital as investors.

After months of deliberation, the deal is in the last leg of consummation and may be able to get all the approvals soon.

Debt-laden GMR Infra will sell a higher stake in its crown jewel airports arm than what it had announced earlier. The divestment has been increased from 44.44 percent to 49 percent to the same group of investors GIC, Tata Group and SSG Capital. Sources suggest that the Singapore government-owned GIC may have increased the stake in the new deal structure and may be now the single largest investor in GMR Airports once the deal is completed.

GMR infra had announced the stake sale in GMR Airports in March 2019 at a value of Rs 8,000 crore for 44.44 percent stake and is awaiting regulatory approval for it to fructify. Sources suggest that an increase in stake sale will also mean more fundraise for GMR Infra. Sources indicate that after months of deliberation, the deal is in the last leg of consummation and may be able to get all the approvals soon.

The stakeholding by the three investors is also likely to change from what was announced earlier. Sources with direct knowledge suggest that Tata Group could be holding close to 15 percent stake in GMR Airports as part of the deal from the earlier 19.7 percent. This could be to comply with Airport Authority of India’s rule of capping any airline’s stake in an airport to 10 percent. GMR Airports owns 64 percent in Delhi International Airport (DIAL). Tata Group runs two different airlines, Vistara and Air Asia India. The reworked deal structure may see Tata Group with around 15 percent, SSG Capital around 10 percent and rest by GIC in the airport business.

State-owned Airports Authority of India (AAI) had raised objections to the proposed investment by Tata Group in GMR Airports on the grounds that it violates the operation, management and development agreement (OMDA) signed in 2006. The regulatory approval from AAI is still pending for the deal.

In the meantime, GMR Infra had raised Rs 2,000 crore from Tata and GIC via non-convertible debentures to repay debt. Stake sale in GMR Airports will be to TRIL Urban Transport, a part of Tata Group, an affiliate of GIC and SSG Capital as investors. This transaction is extremely crucial for GMR Infra to demonstrate its commitment to deleverage.

GMR to divest more in airport arm, to sell 49% to GIC, Tata Group and SSG Capital

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