GVK Airport has secured two new investors that could potentially take obtain up to a 49% stake in the Indian airport operator.
A term sheet and exclusivity agreement was signed with Abu Dhabi Investment Authority (ADIA), and the National Investment & Infrastructure Fund (NIIF) to invest in the issuance of new company shares. GVK Airport will be subjected to due diligence by ADIA and NIIF, and that the transaction will be closed after fulfilling certain conditions.
GVK Airport's parent GVK Power & Infrastructure says it had initiated "a process to identify and select preferred investors to raise capital to reduce or refinance debt obligations of up to Rs57.5 billion ($827 million)". Funds raised will be used to retire GVK's debt obligations.
"We are delighted to sign these agreements with ADIA and NIIF. The funds brought in through this proposed transaction will help us deleverage as we continue with our endeavours to create the infrastructure for a strong aviation hub in India that will provide the impetus for growth and development for the entire country," says GVK's founder and chairman GVK Reddy.
GVK Airport, through its subsidiary Mumbai International Airport, is the operator of Mumbai's Chhtrapati Shivaji International airport. In January 2018, the company signed a concession agreement to operate the upcoming Navi Mumbai airport for 30 years, with an option of extending it by another 10 years.