Bidvest’s plan to sell Mumbai airport stake approved
The court dealt a blow to majority shareholder GVK’s bid to increase its ownership, dismissing it as ‘ambitious’ and ‘inflated’
New Delhi — Bidvest won court approval to sell its holding in Mumbai International Airport to a third party, dealing a blow to majority holder GVK Power & Infrastructure’s bid to increase its ownership.
The ruling allowed unit Bid Services Division (Mauritius) to divest its 13.5% stake, dismissing GVK’s effort to exercise its right of first refusal. The judge said GVK failed to show any preparedness to purchase the shares.
GVK’s appeal was “ambitious” and it “inflated” the company’s readiness to buy, the court said. Despite several rounds of negotiations to reach an out-of-court settlement, GVK did not show a “genuine inclination” to complete the transaction, according to the ruling.
GVK, which is trying to increase its stake to 74% from 50.5%, had offered in March to buy a 10% stake held by a unit of Airports Company SA. Billionaire Gautam Adani’s Adani Enterprises is eyeing a stake in Mumbai airport, according to local media reports.
India will become the third-largest air traffic market in 10 years, with more first-time flyers emerging from the country’s growing middle class, according to the International Air Transport Association.
In February, Adani Enterprises was the highest bidder to develop and operate six Indian airports, a foray into the world’s fastest-growing aviation market last year.
A consortium of India’s Tata, a unit of Singapore’s sovereign wealth fund, and SSG Capital Management are investing 80-billion rupees ($1.2bn) to buy a stake in GMR Airports, which runs India’s biggest airport in New Delhi.
Bloomberg