Singapore's Changi Airports in talks to buy 26% in GVK Airport Holdings
26 December 2011
Singapore's Changi Airports International, a wholly-owned subsidiary of Changi Airports Group, is in talks to buy a 26 per cent stake in GVK Power & Infrastructure's airport business.
Citing a person familiar with the situation, The Economic Times today reported that the deal comes just before bidding for building a planned airport at Navi Mumbai, expected next year.
Changi Airports International is likely to pay GVK Airport Holdings Private Ltd between Rs2,000 and 2,200 crore for the 26 per cent stake, valuing the Hyderabad-based company's airport assets at Rs8,000 crore.
The valuation and the deal size are much bigger than GVK's current market cap of Rs1,738.70 crore. The deal will also help GVK, which holds debt of over Rs5,000 crore, to finance its airport business.
"The deal is in the final stages, and an announcement is likely to be made in January," the paper said quoting its source.
GVK owns 50.5 per cent of Mumbai's airport and 43 per cent of Bangalore airport, and is the operator for both airports. It holds the first right of refusal to develop the Navi Mumbai airport.
The deal with Changi Airports Group, which has bagged more than 370 "best" awards for Singapore's Changi International Airport world-wide from travel trade groups and publications, would help GVK stave off competition from domestic and international rivals for the multi-million Navi Mumbai airport bid.