GMR Infra completes strategic partnership deal with Groupe ADP for airports business

V Rishi Kumar Hyderabad | Updated on July 07, 2020 Published on July 07, 2020

A file picture of Delhi airport   -  V_V_Krishnan

Slight change in contours of deal given the unprecedented circumstances of Covid-19

GMR Infrastructure Ltd has completed its strategic partnership deal with Groupe ADP. The contours of the deal, announced earlier this year, have undergone slight modifications considering the unprecedented circumstances arising due to the pandemic.

According to the revised Share Purchase Agreement, the second tranche of the investment for 24.01 per cent of GMR Airports Ltd has been structured in two parts:

A firm amount, immediately paid at second closing, for a total of Rs 4,565 crore, including Rs 1,000 crore equity infusion in GMR Airports Ltd.

Earn-outs amounting to Rs 1,060 crore, subject to the achievement of certain performance related targets by GMR Airports Limited up to FY2024.

Also read: France’s Groupe ADP to buy 49% stake in GMR airport biz for ₹10,780 cr

Accordingly, Groupe ADP has increased Earn-outs for GMR, which are now pegged at up to Rs 5,535 crore, compared to the earlier Rs 4,475 crore. These Earn-outs are linked to the achievement of certain agreed operating performance metrics as well as the receipt of certain regulatory clarifications over the next five years.

Also read: GMR Airports’ international partner Groupe ADP raises €2.5 billion in bonds


Second tranche of payment received

An amount of Rs 4,565 crore towards the second and final tranche payment from Groupe ADP has been received. This money will primarily be used for servicing debt, which will help deleverage GMR Group further and result in improved cash flows and profitability.

As part of the terms of the transaction, GMR will retain management control over the Airports Business, with Groupe ADP having customary rights and board representation at GMR Airports Ltd and its key subsidiaries.

The partnership between GMR and Groupe ADP is being structured as a strong strategic partnership, to be built on two-way exchange of expertise, personnel, knowledge and market access. Passengers and other stakeholders will also benefit, thereby, setting newer industry-defining benchmarks.

GMR Group’s airport portfolio has a passenger capacity of 172 million in operation and under development, comprising India's busiest airport, the Indira Gandhi International Airport in New Delhi, Hyderabad’s Rajiv Gandhi International Airport, Mactan Cebu International Airport in partnership with Megawide in Philippines. Greenfield projects under development include airports at Mopa in Goa and at Heraklion, Crete in Greece, in partnership with GEK Terna.

Groupe ADP develops and manages airports, including Paris-Charles de Gaulle, Paris-Orly and Paris-Le Bourget.

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Published on July 07, 2020
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