GVK to sell 33 pc stake in Bangalore airport to Fairfax Group for Rs 2,149 cr

28 March, New Delhi

GVK Power & Infrastructure Ltd today said it will divest 33 per cent stake in Bangalore International Airport (BIAL) to Fairfax India Holdings Corporation and Fairfax Financial Holdings Ltd for Rs 2149 crore. Upon completion of this transaction, there would be a reduction of Rs 2,000 crore in debt burden and a saving of Rs 300 crore a year in interest cost, the company said

The transaction is subject to customary closing conditions and third party consents, including lender consents, and is expected to be completed by the middle of 2016.”We chose Fairfax as a partner in BIAL as we have a long standing relationship with its Chairman, Prem Watsa and we would look forward to partnering with them in developing Kempegowda International Airport through its next stage of expansion as we develop a new world-class Terminal 2 and a new runway, said Dr GVK Reddy, founder Chairman and Managing Director, GVK Group, in a statement.”

We have great admiration for GVK, led by Dr GVK Reddy and G V Sanjay Reddy, in the outstanding work that they have done to develop Kempegowda International Airport to its current stature.This is a partnership between Fairfax and GVK, added Prem Watsa, Chairman of Fairfax India, and Chairman and CEO of Fairfax.Bangalore International Airport Ltd owns and operates the Kempegowda International Airport Bengaluru (KIAB), under a 30+30 year concession agreement from the Government of India.

GVK shall remain a long-term investor in airport assets in India as it is bullish on the airport sector and shall continue to build iconic assets for the country.Goldman Sachs and DSP Merrill Lynch are the financial advisors to GVK and Cyril Amarchand Mangaldas is the legal advisor to GVK.