HYDERABAD: In a significant move, GMR Infrastructure Ltd signed a pact with Paris-based Groupe ADP to sell 49 per cent stake in its airports business GMR Airports Ltd (GAL) for an equity consideration of Rs10,780 crore.
The deal includes Rs 9,780 crore towards secondary sale of shares by GMR and Rs1,000 crore equity infusion in the airports business. GMR will receive the first tranche of Rs5,248 crore immediately, which will help it deleverage and improve cash flows and profitability.
As part of the terms of transaction, GMR will retain management control over the airports business with Groupe ADP getting customary rights and board representation at GAL and its key subsidiaries.
The deal values GAL at about Rs22,000 crore. Besides, Groupe ADP has also pegged earn-outs up to Rs4,475 crore linked to achievement of certain agreed operating performance metrics as well as on receipt of certain regulatory clarifications over the next five years.
Therefore, the total valuation assuming earn-outs are successfully consummated may reach Rs26,475 crore on post-money basis, the company said.According to 2019 passenger statistics, the combined passengers handled by GMR Airports and Groupe ADP stands at 336.5 million, the highest across the world.
Together, GMR and Groupe ADP will join fores in airport development and operations to offer superior experience to passengers. Importantly, it’ll open up opportunities for route development, enhanced expertise in operations, retail, IT, innovation, engineering and others.
“Partnership with Groupe ADP is in line with GMR’s business direction to become a global airport developer and operator...defining airports of future with key focus on passenger experience by leveraging enhanced technology and offering superior amenities,” said GM Rao, chairman, GMR.