Adani Group sets its eyes on 23.5% stake in Mumbai Airport

Mumbai/New Delhi: The Gautam Adani-led Adani Group has placed a formal offer to purchase the 23.5 percent stake held by two South African companies in the Mumbai International Airport Ltd (MIAL). The airport is a joint venture between GVK Group, Airports Authority of India (AAI), Bidvest and Airports Company South Africa (ACSA).

GVK Airport Developers, a fully-owned unit of GVK Power and Infrastructure Ltd, owns 50.5 percent of MIAL, while the Airports Authority of India holds 26 percent, Bidvest owns 13.5 percent and ACSA holds around 10 percent.

ACSA, Bidvest invoke RoFR

The Adani Group is considering buying stakes of ACSA and Bidvest, at a valuation of Rs 9,500 crore, sources said. The South African firms are said to be considering walking out the venture, having invoked the right of first refusal (RoFR) clause. This forced the cash-strapped GVK Group to rush for funds to keep the Adani Group from taking a large share of the second busiest airport in the country. The invocation can happen just once, going by the agreement.

Sovereign wealth fund Abu Dhabi Investment Authority, Spanish infrastructure company Ferrovial and Canadian pension fund PSP Investments had submitted final bids earlier this month to buy a stake in GVK Airport Holdings.

Valuation less than expected

As per reports, Bidvest's holdings are valued at Rs 1,248.75 crore, or Rs 77 per share. MIAL is valued at around Rs 9,500 crore at this rate, lower than the promoter group's expectation. With GVK receiving stake sale proposal from both the partners, along with the RoFR clause, gives GVK Group a chance to match the offer, a source said.

"The GVK group will match the offer and buy the 23.5 percent stake in the company. We will not let the stake in the company go to anyone else," a source said.