Financial Daily from THE HINDU group of publications
Saturday, Apr 01, 2006
Financial Daily from THE HINDU group of publications Saturday, Apr 01, 2006 |
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Modernisation AAI board clears shareholder pact for airports revamp Ashwini Phadnis
AAI will lease the assets of these two airports to the two new companies into which GMR and the GVK groups would be pumping in 74 per cent equity, thereby, allowing them to use the airport assets, sources indicated.
New Delhi , March 31 In a move, which should give a boost to the Government's plans to modernise and develop Delhi and Mumbai airports, the board of Airports Authority of India has approved the shareholders' agreement and the memorandum of articles of association for the modernisation and restructuring of the two metro airports. "AAI that owns the two companies — Delhi International Airport Ltd (DIAL) and Mumbai International Airport Ltd (MIAL) — formed for undertaking the restructuring, can now sell shares from these companies to the GMR and GVK groups that have been shortlisted for modernising the two airports. "The funds realised from the sale of 74 per cent equity in the two new companies will help start the development process in the two airports," official sources told Business Line. AAI will lease the assets of these two airports to the two new companies into which GMR and the GVK groups would be pumping in 74 per cent equity, thereby, allowing them to use the airport assets, sources indicated. The total capital in DIAL will be around Rs 200 crore, of which the contribution of the GMR group will be about Rs 150 crore. The latest board decision also clears the way for signing of the operation management and development agreement (OMDA). The OMDA is considered the mother document under which the AAI, in the interest of better management of the airport and overall public interest, grants the joint venture company the right to operate, maintain, develop, design, construct, upgrade, modernise, finance and manage the airport. Initially, the OMDA is for 30 years although it can be extended for another 30 years. The Government has fixed the mandated capital expenditure during the first five years at Rs 2,600 crore for the Mumbai airport and at Rs 2,800 crore for the Delhi airport. The GMR consortium includes Malaysia Airports, while the GVK group has tied up with South African airports to undertake the modernisation of Delhi and Mumbai airports respectively.
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