announced a proposed investment by Tata Group “Tata”, an affiliate of GIC, Singapore’s sovereign wealth fund “GIC” and SSG Capital Management “SSG” (Investors) in its Airports Business. GIL has signed a binding term sheet with the investors pursuant to which the investors have agreed to invest Rs8,000cr in GMR Airports Limited (GAL).
The investment amount of Rs8,000cr will consist of Rs1,000cr equity infusion in GAL; and Rs7,000cr towards the purchase of GAL’s equity shares from GIL and its subsidiaries, the company said in the filing.
The proposed investment is subject to definitive documentation, customary regulatory approvals, lender consents and other approvals.
Following the investment, GIL proposes to demerge its Energy, Highways, Urban Infrastructure & Transportation businesses, leading to separation of its Airport Business, subject to customary consents, regulatory & corporate approvals.
As part of the terms of the proposed investment, GIL will retain management control over the Airports Business with the investors having customary rights and board representation at GAL and its key subsidiaries.
As part of this transaction, GIL also intends to provide an exit to existing private equity investors who hold 5.8% Equity Stake in GAL. At Closing, GIL and its subsidiaries will hold c.54% stake in GAL, Employee Welfare Trust will hold 2%, Tata will hold c.20% stake, GIC will hold c.15% stake and SSG will hold c.10% stake
Grandhi Kiran Kumar, Managing Director & CEO, GIL, said “We are very pleased to welcome Tata, GIC & SSG as long-term investors in GAL. The proposed investment endorses the strength of the unparalleled Airport platform created by GMR Group and will reduce our debt substantially, strengthening our balance sheet.”
“This proposed investment by marquee investors like Tata, GIC and SSG reaffirms the significant and long-term investment opportunity in the fast-growing Airport Infrastructure space with a large pool of capital that can be tapped to grow GMR Airport infrastructure business,” Grandhi Kiran Kumar added.
This is one more step in the series of steps that GMR Group has taken from time to time for raising long-term capital and demonstrates GMR Group’s ability to withstand all adversities, continue growing its businesses, and deliver on its commitment of unlocking value for all stakeholders.
GMR Infrastructure Ltd is currently trading at Rs19.85, up by Rs0.4 or 2.06% from its previous closing of Rs19.45 on the BSE. The scrip opened at Rs21.25 and has touched a high and low of Rs21.25 and Rs19.45 respectively.