MIAL ownership structure likely to change soon with Adani landing

NEW DELHI: The ownership structure of Mumbai International Airport Ltd (MIAL) may soon undergo a major shift with Adani Group making its long-eyed entry into India’s second busiest airport. At present, debt-laden GVK Group owns 50.5%, followed by 26% by Airports Authority of India (AAI) and 23.5% by South African companies Bidvest (13.5%) and Airports Company South Africe (ACSA, 10%).
Billionaire Gautam Adani’s Adani Enterprises Ltd (AEL) is “evaluating” MIAL and is considering buying a controlling stake (51%) in MIAL by picking up from stakes from three (other than AAI) owners.
Adani and GVK did not comment on the issue. Sources said an announcement could be made soon. In the past two years, Adani Group had been trying to buy out stakes of the South African companies but it was challenged legally by GVK.
Last October, to ring fence itself from Adani’s takeover, GVK secured funding for over Rs 7,600 crore for its airport-holding company by signing binding agreements with Abu Dhabi Investment Authority, Public Sector Pension Investment Board and National Investment and Infrastructure Fund. But this funding has not yet come. Financial closure for building the Rs 17,000-crore Navi Mumbai airport, which GVK won, is being negotiated, now with SBI.
While financial troubles for the highly-leveraged GVK kept mounting, drying up of airport revenue during the corona pandemic dealt a body blow. In the last few months, their legal challenges increased with CBI and ED probing some aspects of Mumbai Airport.
The group has been trying to retain control of Mumbai airport. Over three years back it sold its entire 43% stake in Bengaluru airport to Prem Watsa’s Fairfax Holdings to trim mounting debt.
The Rs 7,600-crore funding secured last October by GVK Airport Developers Ltd (GVKADL) that has not yet come was to be used by GVK to “primarily retire debt obligations of its holding companies significantly and fund purchase of additional shares in MIAL by GVK Airport Holdings Ltd from Bidvest and ACSA in accordance with right of first offer exercised by GVKAHL”. But given mounting challenges, it remains to be seen if GVK can stop an Adani landing at MIAL now.