GMR gets stay on Maldives airport deal termination

GMR-MALDIVES-AIRPORT:GMR gets stay on Maldives airport deal termination

Infrastructure has won a stay order from a Singapore court on the government's cancellation of its $511 million development contract, the company said, adding that it would operate the airport as normal.

The court order on Monday suspends the government's decision to cancel its biggest foreign investment project, GMR said, which raised fears over foreign investor protection in the country and rattled its relations with India.

"We have obtained an injunctive stay on the operations of that (contract termination) letter," said Arun Bhagat, spokesman for the GMR group.

"So which, in effect means, we continue to operate (the airport) as normal business."

The government of the Maldives, a tropical island chain south-west of India famous for its luxury beach resorts and white sands, last week terminated GMR's contract to develop and operate an international airport at Male, its capital.

Shares in GMR were up 4.3 percent at 19.35 rupees at 1:15 p.m. in a Mumbai market that was down 0.15 percent.

The cancellation of the deal signed in 2010 follows President Mohamed Waheed's failure to renegotiate terms, sources close to president's office told Reuters.

The cancellation follows a year of political turmoil that saw the ousting of its former president and months of unrest.

"If they don't comply (with the stay order), the Maldives will no longer be respected as upholding its obligations under international law, which will be very detrimental to future foreign investment," Fayyaz Ismail, a lawyer for GMR told Reuters. "Hopefully they will be reasonable."

Imad Masood, a spokesman for the President of Maldives said he has not received the court's order when contacted by Reuters.

The contract to upgrade and operate the airport and build a new terminal came after a global tender overseen by the World Bank and signed under former president Mohamed Nasheed's administration.

The project was implemented through a joint venture company comprising GMR Infrastructure Limited and Malaysia Airports Holding Berhad .

However, Nasheed's rivals filed legal action saying the contract was invalid as it contained a $25 airport development charge per outgoing passenger which was not authorised by the parliament.

image
Business Standard
177 22
Business Standard

GMR gets stay on Maldives airport deal termination

GMR-MALDIVES-AIRPORT:GMR gets stay on Maldives airport deal termination

Reuters  |  Mumbai 



Infrastructure has won a stay order from a Singapore court on the government's cancellation of its $511 million development contract, the company said, adding that it would operate the airport as normal.

The court order on Monday suspends the government's decision to cancel its biggest foreign investment project, GMR said, which raised fears over foreign investor protection in the country and rattled its relations with India.

"We have obtained an injunctive stay on the operations of that (contract termination) letter," said Arun Bhagat, spokesman for the GMR group.

"So which, in effect means, we continue to operate (the airport) as normal business."

The government of the Maldives, a tropical island chain south-west of India famous for its luxury beach resorts and white sands, last week terminated GMR's contract to develop and operate an international airport at Male, its capital.

Shares in GMR were up 4.3 percent at 19.35 rupees at 1:15 p.m. in a Mumbai market that was down 0.15 percent.

The cancellation of the deal signed in 2010 follows President Mohamed Waheed's failure to renegotiate terms, sources close to president's office told Reuters.

The cancellation follows a year of political turmoil that saw the ousting of its former president and months of unrest.

"If they don't comply (with the stay order), the Maldives will no longer be respected as upholding its obligations under international law, which will be very detrimental to future foreign investment," Fayyaz Ismail, a lawyer for GMR told Reuters. "Hopefully they will be reasonable."

Imad Masood, a spokesman for the President of Maldives said he has not received the court's order when contacted by Reuters.

The contract to upgrade and operate the airport and build a new terminal came after a global tender overseen by the World Bank and signed under former president Mohamed Nasheed's administration.

The project was implemented through a joint venture company comprising GMR Infrastructure Limited and Malaysia Airports Holding Berhad .

However, Nasheed's rivals filed legal action saying the contract was invalid as it contained a $25 airport development charge per outgoing passenger which was not authorised by the parliament.

RECOMMENDED FOR YOU

GMR gets stay on Maldives airport deal termination

GMR-MALDIVES-AIRPORT:GMR gets stay on Maldives airport deal termination

GMR Infrastructure has won a stay order from a Singapore court on the Maldives government's cancellation of its $511 million airport development contract, the company said, adding that it would operate the airport as normal.

Infrastructure has won a stay order from a Singapore court on the government's cancellation of its $511 million development contract, the company said, adding that it would operate the airport as normal.

The court order on Monday suspends the government's decision to cancel its biggest foreign investment project, GMR said, which raised fears over foreign investor protection in the country and rattled its relations with India.

"We have obtained an injunctive stay on the operations of that (contract termination) letter," said Arun Bhagat, spokesman for the GMR group.

"So which, in effect means, we continue to operate (the airport) as normal business."

The government of the Maldives, a tropical island chain south-west of India famous for its luxury beach resorts and white sands, last week terminated GMR's contract to develop and operate an international airport at Male, its capital.

Shares in GMR were up 4.3 percent at 19.35 rupees at 1:15 p.m. in a Mumbai market that was down 0.15 percent.

The cancellation of the deal signed in 2010 follows President Mohamed Waheed's failure to renegotiate terms, sources close to president's office told Reuters.

The cancellation follows a year of political turmoil that saw the ousting of its former president and months of unrest.

"If they don't comply (with the stay order), the Maldives will no longer be respected as upholding its obligations under international law, which will be very detrimental to future foreign investment," Fayyaz Ismail, a lawyer for GMR told Reuters. "Hopefully they will be reasonable."

Imad Masood, a spokesman for the President of Maldives said he has not received the court's order when contacted by Reuters.

The contract to upgrade and operate the airport and build a new terminal came after a global tender overseen by the World Bank and signed under former president Mohamed Nasheed's administration.

The project was implemented through a joint venture company comprising GMR Infrastructure Limited and Malaysia Airports Holding Berhad .

However, Nasheed's rivals filed legal action saying the contract was invalid as it contained a $25 airport development charge per outgoing passenger which was not authorised by the parliament.

image
Business Standard
177 22
Widgets Magazine

More News

Widgets Magazine
Widgets Magazine

Upgrade To Premium Services

Welcome User

Business Standard is happy to inform you of the launch of "Business Standard Premium Services"

As a premium subscriber you get an across device unfettered access to a range of services which include:

  • Access Exclusive content - articles, features & opinion pieces
  • Weekly Industry/Genre specific newsletters - Choose multiple industries/genres
  • Access to 17 plus years of content archives
  • Set Stock price alerts for your portfolio and watch list and get them delivered to your e-mail box
  • End of day news alerts on 5 companies (via email)
  • NEW: Get seamless access to WSJ.com at a great price. No additional sign-up required.
 

Premium Services

In Partnership with

 

Dear Guest,

 

Welcome to the premium services of Business Standard brought to you courtesy FIS.
Kindly visit the Manage my subscription page to discover the benefits of this programme.

Enjoy Reading!
Team Business Standard