Prem Watsa to buy GVK’s 33% stake in Bangalore Airport
Canada’s billionaire Prem Watsa-supported Fairfax to buy 33% stake in Bangalore International Airport Ltd for Rs.2,149 crore from GVK, with a purpose to reduce the debt burden of around Rs.2,000 crore
The GVK Power and Infrastructure Ltd. has decided to sell its 33% stake in Bangalore International Airport Ltd. (BIAL) to Canada’s billionaire Prem Watsa’s Fairfax India holding Corp. and Fairfax financial holding for Rs.2,149 crore. GVK is expecting to reduce the debt load from this agreement by more than Rs.2,000 crore and save around Rs.300 crore of interest payment a year from the transaction. GVK’s Mumbai International airport, also has a debt of almost Rs.3,500 crore. The company began the process of paring it last year. Fairfax India holding Corp. and Fairfax Financial Holding will be holding 10% of their shares through companies in Mauritius. The other stakeholders are Siemens Projects Venture holding 26% in Bangalore International Airport Ltd., Flughafen Zurich AG a 5%, Karnataka State Industrial Investment and Development Corporation and Airport Authority of India a 13% each. Continuing on a positive note the stocks of GVK Power and Infrastructure Ltd. increased by 6.4% to Rs.7.12 on the BSE on Monday. According to GVK Reddy, Chairman and Managing director of GVK, “this is an important milestone in de-leveraging our balance sheet, and all proceeds from this stake sale shall be used to bring down our debt.” “We chose Fairfax because we have a long relationship with Prem Watsa and we look forward to partnering them in developing a new terminal and a new runway,” he stated. Watsa, Chairman of Fairfax India said, “We will support GV Sanjay Reddy as managing director of BIAL and GVK Reddy will continue as co-chairman of BIAL.”
March 29, 2016 | 04:15pm IST
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