Battle For Mumbai Airport

GVK is trying to retain its hold on its crown jewel, the Mumbai International Airport, even as the Adani Group eyes a stake in it. The battle has just begun.

- E. Kumar Sharma

GVK AND ADANI ARE BOTH BIG names in infrastructure. Both symbolise entrepreneurship spawned by the post1991 economic liberalisation. Yet, both are distinctly different. One broke the mould as developer of the Mumbai International Airport, and turned it into one of the best in the world but is cash-strapped now and has been forced to restrain any expansion. The other is also deep in debt and although new to the airport business, is driven by an unmistakable ambition to make it big in the business. Other than a big-bang entry early this year into this space by winning bids to operate six airports, the Adani Group also seems keen to have a say in the running of the Mumbai International Airport (MIAL) in which GVK has a 50.5 per cent stake.

The Adani Group has been in the news for its private offer to South Africa’s Bidvest Group, which holds a 13.5 per cent stake and a board seat in MIAL, and is seeking to buy Bidvest’s stake at 77 per share for around 1,200 crore. But GVK is fighting tooth and nail — after all, the airport business revenue of around 3,700 crore, largely from this airport, accounts for nearly 90 per cent revenue of its listed entity, GVK Power & Infrastructure. The group has moved court for exercising its right of first refusal for the Bidvest stake and is arranging funds to back its offer.

Adani’s move comes on the back of it emerging as the successful bidder early this year for upgrading and operating six airports – Ahmedabad, Lucknow, Jaipur, Guwahati, Mangalore and Thiruvananthapuram. Sources say the group is keen to become the largest player in the country. Mumbai is an important pit stop in this journey.

The Adani Group’s spokesperson refused to comment on the offer to Bidvest and the group’s plans for the Mumbai airport.

The Mumbai Advantage