Deccan-led consortium to build and operate small airports disbands as GVK Group backs off
26 Dec 2007
Bangalore/Hyderabad: The decision to merge Air Deccan and Kingfisher Airlines may have
had an unintended fallout with construction major, GVK Group, pulling out of a four-partner consortium set up to build low-cost airports in small Indian towns. Deccan Aviation Ltd was the prime mover behind the consortium.
The Deccan-led consortium also included the private equity arm of Infrastructure Development Finance Co. Ltd (IDFC) and K Raheja Corp., a Mumbai construction firm. All four were equal partners in the venture.
According to an initial agreement between the partners, the distribution of interests in the consortium would have seen GVK, which operates the international airport in Mumbai, building and operating the airports, the Rahejas building shopping malls and industrial parks, Air Deccan operating dedicated flights to the airport from other cities and IDFC's private equity arm funding the venture.
The consortium was to bid for new airport projects in small towns in Karnataka, Andhra Pradesh and Maharashtra on 'build, operate and transfer' or BOT models.
According to reports, officials of the Hyderabad-based GVK Group, who requested anonymity, said the partners failed to find a ''great opportunity'' in building airports in smaller towns.
