By James Mathew
Abu Dhabi Investment Authority, along with Canada's PSP Investments and India's NIIF, to invest over $1bn in GVK group
Abu Dhabi Investment Authority (ADIA), along with Canada’s PSP Investments and India’ infrastructure sovereign fund National Investment and Infrastructure Fund (NIIF), will invest $1.07 billion in India’s GVK group, operator of Mumbai’s Chhatrapati Shivaji Maharaj International Airport.
The investment will be partly used by to fund the acquisition of stakes of its two South Arica-based partners in Mumbai International Airport Ltd (MIAL) - Bidvest and ACSA. Bidwest and ACSA together hold 23.5 stake in MIAL.
The exact investment by ADIA in the Indian infrastructure major is unclear.
“GVK Airport Developers Limited (GVKADL) and GVK Airport Holdings Limited (GVKAHL) have entered into definitive agreements with subsidiaries of the Abu Dhabi Investment Authority, Public Sector Pension Investment Board (PSP Investments) and with National Investment & Infrastructure Fund, whereby the Investors will make an aggregate investment of INR 7,614 Crore into GVKAHL,” GVK Power & Infrastructure said in a statement.
“Proceeds from the above transaction will be used by GVK to primarily retire debt obligations of its holding companies significantly and fund the purchase of additional shares in MIAL by GVKAHL from Bidvest and ACSA in accordance with the Right of First Offer already exercised by GVKAHL,” the statement added.
The transaction closure is subject to the satisfactory completion of closing conditions, including regulatory and third party approvals and lender consents.
Investments from ADIA and other funds will help GVK group to fend off efforts by Adani Group – another India infra major - to acquire Bidwest and ACSA’s stakes in MIAL.
GVK Group is also the developer of Navi Mumbai International Airport, Mumbia’s second internatonal airport which is currently under development.
It had earlier sold its stake in the Bangalore International Airport Limited to bring down its mounting debt obligations.
GVK has been working towards paring its debt, and the deal with the three funds will pave the way for a smoother transition as it takes up development of the Navi Mumbai airport.