Groupe ADP, an international airport operator based in Paris has inked a share purchase agreement with GMR Infrastructure Ltd. (GIL) to buy 49% stake in its airport’s arm GMR Airports Limited (GAL) India. Total value of the agreement is Rs 10,780 crore and will be executed in two steps.
In the first step, the ADP will buy 24.99 % stakes in GMR airports. In the second step, ADP will buy 24.01% stakes which are subjected to certain regulatory conditions, in particular from the Reserve Bank of India.
The total value comprises Rs 9,780 crore towards secondary sale of shares by GMR group, and Rs 1,000 crore equity infusion in GMR Airports Ltd. As per the statement of GMR Infrastructure “The first tranche of Rs 5,248 crore will be received by GMR Group immediately. This money will help de-leverage the group further and result in improved cash flows and profitability.”
GMR Infrastructure had a consolidated net-debt of Rs 25,660 crore as of 31st December 2019.
Status After the GMR-ADP Airports Deal
After closure of the deal GMR Infrastructure will hold 51% stake in GMR Airports and retain control over the company. At the same time Groupe ADP shall have extended governance rights such as equal board members as GMR Infrastructure and rigjt to appoint key executives in GMR Airports.
Augustin de Romanet Chairman and Chief Executive Officer of Aeroports de Paris SA-Groupe ADP stated in company’s statement dated 20th February 2020 “The acquisition of a 49 % stake in GMR Airports fits within Groupe ADP’s strategy. This acquisition comes with a robust industrial partnership and enables Groupe ADP to build … a unique worldwide network of airports with a solid industrial expertise and strong development capacities. Medium and long term growth driver, this acquisition is a transforming position for the group in one of Asia’s most dynamic and promising countries.”
GM Rao, Chairman, GMR Group stated in the same statement: “The partnership with Groupe ADP is in line with GMR’s business direction to become a global airport developer and operator. With Groupe ADP, GMR will have smoother access to global markets, opening up newer avenues of business growth.”
About GMR Airports: it is an Indian airport group comprising airports in three countries- India, Philippines, and Greece. Presently, it owns and operates Delhi International Airport and Hyderabad International Airports. Further, it has recently won the concession to develop and operate Goa’s Greenfield airport at Mopa. It is also operating and developing Mactan Cebu International Airport in partnership with Megawide Construction Corporation of Philippines.
About Groupe ADP: formerly known as Aéroports de Paris or ADP, is an international airport operator based in Paris. It develops and manages airports, including Paris-Charles de Gaulle, Paris-Orly and Paris-Le Bourget.