Prem Watsa ruled out sale of stakes in Bangalore International Airport Ltd (BIAL), telling ET he has big plans for it and calling the facility the “best airport in the world.”
Its second terminal was inaugurated on November 11 by Prime Minister Narendra Modi.
“Fairfax’s stake in Bangalore airport is not for sale,” said Watsa, chairman of the $90-billion Toronto-headquartered Fairfax Financial Holdings. “News reports claiming we are selling the airport are wrong.”
Fairfax is the controlling shareholder of the airport, which will continue to expand until 2029, by when it will cater to 90 million passengers annually, Watsa told ET. Infrastructure is being planned around it.
“We are creating a brand-new city. We can’t do too much in Bangalore because it is built up. That’s why we are building an airport city,” said Watsa.
Watsa and BIAL chief executive Hari Marar outlined plans for the airport city, which will span 463 acres and have office parks, hotels, shopping, entertainment, medical tourism and education.
“In the next eight to 10 years, our aim is to develop a smart, sustainable and vibrant airport city with business parks, IT parks, a medical district with a world-class multi-specialty hospital, academic institutions, concert arena, over 2,500 hotel rooms and a world-class retail, dining and entertainment district,” said Marar.
The airport city will also feature warehousing, high-tech manufacturing and large-scale cloud kitchens. “This development will result in a creation of more than 100,000 professional jobs, resulting in massive socio-economic development of north Bangalore,” he said.
Fairfax has spent Rs 12,500 crore on development of the airport, which it took control of five years ago. The new terminal is expected to be open to travellers in December. “With the success of Bangalore international airport and under Hari’s leadership with Anchorage, we will be expanding on further projects of infrastructure, particularly airports,” Watsa said. “It will take a bit of time, but we are focused on getting it done.” Anchorage was set up as a corporate entity under Fairfax India to house the airport and infrastructure businesses of the investment giant in the country. Fairfax outlined plans for an initial public offering of Anchorage in 2019 in its annual report. The entity was floated in the same year. However, it has not initiated the share sale process. “We are not under any pressure to do an IPO in a specified time,” Watsa said. He didn’t elaborate.
Investment Destination
Watsa reiterated his support for the Prime Minister. “I want to say this airport would not be possible if not for the leadership of the Honourable PM, Mr Modi,” Watsa said. “As you know, he inaugurated the airport (terminal) a few days ago. India is blessed to have a leader like Mr Modi, a leader unlike any the world has ever seen, who is single-mindedly focused on the economic development of India for all of its 1.3 billion citizens.” He pointed to the country’s attractiveness as an investment destination. “India is the number one country in the world to invest in, and India is booming,” he said. “IPOs will come back again; unicorns will come back again.” Marar said he expects a boom in the aviation sector over the next three years. “Passenger traffic has crossed pre-Covid levels, at least on the domestic front,” he said. “International travel will also come back. It has supply side constraints because of lack of aircraft. We can expect 10-12% CAGR (compounded annual growth rate) in the next three to four years.”
