GMR Infrastructure airport stake sale to Groupe ADP
GMR Infrastructure Limited (GIL) has announced a strategic partnership with Groupe ADP for its airports business, the company said.
GMR Infrastructure has signed a share purchase agreement pursuant to which Groupe ADP will hold a 49 per cent stake in GMR Airports Limited (GAL) for an equity consideration of Rs 10,780 crore, valuing GAL at Rs 22,000 crore.
This equity consideration comprises Rs 9,780 crore towards the secondary sale of shares by the GMR group and Rs 1,000 crore equity infusion in GMR Airports.
Groupe ADP has also pegged earn-outs up to Rs 4,475 crore linked to achievement of certain agreed operating performance metrics as well as on receipt of certain regulatory clarifications over the next five years.
Total valuation, assuming all above earn-outs are successfully consummated, may reach Rs 26,475 crore.
The first tranche of Rs 5,248 crore will be received by GMR Group immediately. This money will help to deleverage the group further and result in improved cash flows and profitability.
As part of the terms of transaction, GMR will retain management control over the airports business with Groupe ADP having the customary rights and board representation at GMR Airports Limited and its key subsidiaries.
The deal will unveil a first-of-its-kind airport development and operations platform globally.
G.M. Rao, chairman of GMR Group, said, “The partnership with Groupe ADP is in line with GMR’s business direction to become a global airport developer and operator. We have been on a journey of defining airports of the future with key focus on passenger experience by leveraging enhanced technology and offering superior amenities.
“With Groupe ADP, GMR will have a smoother access to global markets, opening up newer avenues of business growth.”
Augustin de Romanet, chairman and chief executive officer of Aéroports de Paris SA-Groupe ADP, said: “The acquisition of a 49 per cent stake in GMR Airports fits within Groupe ADP’s strategy. It sets a robust industrial partnership and enables Groupe ADP to build, only two years after taking control of TAV Airports, a unique worldwide network of airports with a solid industrial expertise and strong development capacities.
“This acquisition will constitute a growth driver in the medium term, and also a transforming position for the group in one of Asia’s and the world’s most dynamic and promising countries,” Romanet said.