GVK raises $235mn from StanChart to pick up MIAL stake
06 April 2011
Bangalore: GVK Airport Holdings has raised $235 million (Rs1,044 crore) from Standard Chartered (UK) to fund the purchase of 13.5% stake in Mumbai International Airport Ltd (MIAL) from Bid Services Division (Mauritius). GVK Airport Holdings is a subsidiary of GVK Power & Infrastructure.
Bid Services is part of the Johannesburg-based Bidvest Group. As part of the agreement, GVK will pay $287 million to Bidvest over three years.
The acquisition will be funded by a three-year letter of credit for $235 million, which ensures that the bank will make funds available on request anytime in that period.
A GVK spokesperson said that the firm was awaiting the necessary regulatory nod.
Standard Chartered Bank has declined to comment.
According to market observers, the GVK group will consolidate its stake in MIAL to secure better control over operations.
The purchase of the 13.5% stake in MIAL, from Bid Services Division (Mauritius), will help the company raise its total stake in the airport to 50.5%.
GVK is the largest stakeholder in MIAL, followed by the AAI which holds 26%.