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    Home / News / Business News / GVK to sell 33% stake in Bangalore International Airport
    GVK to sell 33% stake in Bangalore International Airport
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    Business 2 min read

    GVK to sell 33% stake in Bangalore International Airport

    By Vaneet Randhawa
    Mar 28, 2016
    06:47 pm
    GVK to sell 33% stake in Bangalore International Airport
    Credits

    GVK Power and Infrastructure Ltd announced its plans to sell 33% stake in Bangalore International Airport Ltd to Fairfax India Holdings Corp. and Fairfax Financial Holdings Ltd for Rs.2,149 crores. This sale would help the company to reduce its debt by Rs.2,000 crore. GVK's interest expenses would also come down by almost Rs.300 crore a year on completion of the deal.

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    GVK: A colossal conglomerate

    GVK is a preeminent Indian conglomerate based in Hyderabad founded by GVK Reddy. The group has knowledge and expertise in assorted sectors including energy, resources, ports, roads, airports, transportation, hospitality and life sciences. GVK has already invested over Rs.24,000 crore ($4.3 billion) in projects in India; furthermore, it has upcoming projects worth over another Rs.36,000 crore ($6.6 billion) in the country.

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    From power plants, road projects to airports

    The GVK group built "India's first independent power plant, the first six-lane road project and developed two of India's largest airports, in Mumbai and Bengaluru."

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    GVK's issue to resolve debt

    GVK announced that the company had procured a lot of debt from the development of Mumbai and Bengaluru airports. The airport division has a debt of Rs.3,500 crore GVK is considering a public issue of its airport business, which includes Bangalore International Airport Ltd (BIAL), Mumbai International Airport Ltd (MIAL) and Bali airport in Indonesia, to retire a part of its debt.

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    5 companies shortlisted for GVK airport stake

    5 bidders had been shortlisted by GVK Airport Services, which runs the Mumbai and Bangalore international airports to sell up to 49% for raising Rs.4,000 crore. GVK Airport hoped to scrap the total debt of Rs.3,600-crore after the stake sale follows through. Sources at GVK also revealed that the company was expecting a pre-money business valuation of Rs.8,800 crore.

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    Reddy looks towards JSW, Changi for stake sale

    On 25 February 2016, the founder of GVK offered to sell their controlling stake in Mumbai and Bangalore airport to Sajjan Jindal-led JSW Group. Previously, on 7 February 2016, it was reported that GVK was planning to sell up to 49% stake in GVK Airport Services to Singapore's Changi Airports Group. The sale was expected to raise about Rs.3,000-3,500 crore.

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