GMR to sell 40% in Istanbul airport for $303M | VCCircle
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GMR to sell 40% in Istanbul airport for $303M

BY  Anuradha Verma
GMR has said the right of first refusal process in respect of the stake sale is in progress and hence the deal is not concluded.

Indian infrastructure developer GMR Infrastructure Ltd is close to offloading its 40 per cent equity stake in Istanbul's Sabiha Gokcen International Airport for about €220 million or around Rs 1,900 crore to Turkey-based TAV Airports Holding Co, Mint reported citing two persons privy to the development.

"Right of First Refusal (ROFR) process in respect of the sale of stake is in progress and hence the deal is not concluded," GMR clarified in a filing with the exchange.

Apart from GMR, Turkish conglomerate Limak Holding holds 40% equity stake in Sabiha Gokcen, while remaining 20% is held by Malaysia Airports. The consortium had won the mandate to build the airport in 2007 and operate it for 22 years for a licensing fee of €2.17 billion.

Malaysia Airports has the first right of refusal and can acquire GMR’s stake if it wishes to in the next two weeks, the paper said. However, if it does not choose to buy GMR’s stake, then Limak Holding has the second right of refusal. In this case, Limak Holding can buy GMR’s stake in

Sabiha Gokcen, if it chooses to, and raise its holding in the airport, the paper added.

The deal is expected to be announced in the coming weeks after the terms of the contract are thrashed out between the two other stakeholders.

The decision is part of the Indian company’s efforts to raise money to pare its debt of Rs 38,019 crore. Istanbul connects Asia and Europe and has two big airports – Sabiha Gokcen on the Asian side and TAV Istanbul Ataturk Airport on the European side.

TAV Airports Holdings, which currently operates Ataturk Airport, has interest in acquiring stake in Sabiha Gokcen as its lease is likely to expire in around six years, the paper quoted an unnamed person as saying.

Sabiha Gokcen was built for a capacity of 25 million passengers and recorded passenger traffic of 15.34 million in fiscal 2012-13.

“The air traffic has picked up very well at this airport…Most of the Middle Eastern airlines are adding services,” the paper said citing the person.

GMR Infrastructure has been selling its assets to improve liquidity. The company, earlier this year, divested its controlling stake in a highway project for about $35 million.

(Edited by Joby Puthuparampil Johnson)

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