GMR Airports Infrastructure Limited (Formerly GMR Infrastructure Limited) (GIL) announced the approval by its board of the composite scheme of amalgamation and arrangement of GMR Airports Limited (GAL) with GIL (Merger). It will raise ₹2,900 crore from Aéroports de Paris SA (Groupe ADP) through 10-year FCCB. GMR Group will remain as the Single Largest Shareholder & in Management Control of GIL.
“..Entering into a Strategic Partnership with Groupe ADP in early 2020 to create a world class airport platform whereby Groupe ADP agreed to purchase 49% stake in GAL. At the time of the transaction, Groupe ADP had pegged equity earnouts of ~8% of GAL and cash earnouts of ₹1,060 Cr to GIL,” the company said in an exchange filing.
Aéroports de Paris and GMR Airports Infrastructure Ltd. agreed to fold their joint-venture company into GMR, giving ADP a liquid stake in a business that owns airfields in India. ADP and GMR Airports Infrastructure own 49% and 51%, respectively, of the unlisted GMR Airports Ltd.
Combining GMR Airports Infrastructure and GMR Airports will simplify the capital structure of the unlisted company, allowing the combined entity to more easily capture new business, the companies said.
The merger will take place in the first half of 2024, the companies said. ADP would hold a 45.7% stake in the combined GMR Airports Infrastructure and GMR Airports.
“Demand for air travel has picked up substantially, which will speed up airport privatization initiatives of the respective governments across the world,” GMR said in a separate statement.
ADP will invest €331 million ($353 million) in foreign currency convertible bonds issued by GMR Airports Infrastructure, with the proceeds used by the Indian company to clear its balance sheet by repaying corporate debt and also settling a major part of its liabilities. The investment will lead to a cash expense of the same amount in the coming weeks, ADP said.
