In a BSE filing, the Adani Enterprises Ltd Monday said: “Adani Airport Holdings Limited (AAHL), the flagship holding company of Adani Group for its airports business (and a subsidiary of Adani Enterprises Limited) has entered into an agreement to acquire the debt of GVK Airport Developers Limited (GVKADL). GVK ADL is the holding company through which GVK Group holds 50.50% equity stake in MIAL, which in turns holds 74% equity stake in Navi Mumbai International Airport Limited (NMIAL).
According to the agreement, AAHL will acquire the debt of GVK ADL from its airport lenders.
“The GVK Group and AAHL have agreed that AAHL will offer a stand-still to GVK, in addition, to release of the guarantee given by GVK Power and Infrastructure Limited with respect to the debt acquired by it. The Adani Group will also take steps to complete the acquisition of a 23.5% equity stake from ACSA and Bidvest in MIAL for which it has obtained CCI approval.
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. AAHL intends to infuse funds into MIAL to ensure that MIAL receives much needed liquidity and also achieves financial closure of Navi Mumbai International Airport to be able to commence construction,” the Adani Group regulatory filing said.
In a statement, the GVK Group said the other terms of the GVK-Adani agreement include: “Acquisition of debt by Adani from various GVK lenders including a Goldman Sachs led consortium and HDFC; release GVK of various obligations, securities and corporate guarantees given in respect of debt to be acquired by Adani and ability for Adani to convert the acquired debt to equity of GVK Airport Developers Ltd (GVKADL) on mutually agreed terms, subject to obtaining necessary regulatory approvals.”
“Separately, GVK has notified the Abu Dhabi Investment Authority, National Investment and Infrastructure Fund and PSP, that the transaction documents stand terminated, as it is no longer effective and implementable. The reason for this decision was a) the terms of the transaction envisaged in the transaction documents were not implementable and b) the alternative proposals discussed would not provide a resolution to the lenders by the end of August, which was a requirement of our lenders,” the GVK Group said in a statement.
The Adani Group had emerged as higher bidder for operating six AAI Airports — Jaipur, Guwahati, Thiruvananthapuram, Ahmedabad, Lucknow and Mangaluru — PPP way for 50 years. The Kerala government is opposing handing over Thiruvananthapuram airport to Adani. With India’s second busiest airport, Mumbai’s CSMIA, and the upcoming Navi Mumbai also in its portfolio, Adani group emerges as the largest private airport developer in India.
GVK Group founder-chairman G V K 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 Limited. 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. It is under these circumstances that we agreed to cooperate with Adani so as to achieve these twin objectives. Further, when the transaction is consummated, which is subject to customary approvals, we would be reducing a significant portion of liabilities to our lenders, which is of utmost importance to the group”.