Mumbai International Airport raises $750 million debt from Apollo Global

The Adani Group-owned Mumbai International Airport (MIAL) has raised $750 million (around Rs 5,715 crore) debt from asset manager Apollo Global to refinance existing loans and fund capital expenditure.

The capital raise comes in the backdrop of recovery in domestic air traffic and resum­ption of scheduled internatio­nal services from March-end.

MIAL runs the country’s second busiest airport and the majority of the proceeds from the 7.25-year $750 million debt will be used to finance shorter maturity loans and new capital expenditure. This will include upgrade to amenities and repair and maintenance of airport facilities, among others, in order to provide better customer experience.

This is one of the largest ever debt raises through private placement, Adani Group said in a press statement.

The group did not disclose additional details regarding loans that will be refinanced or interest gains from the exercise.

Last July, Adani Group took over the operations of MIAL from GVK. In the same month, MIAL’s board approved proposals to issue and allot redeemable non-convertible debentures worth around Rs 4,000 crore to banks and financial institutions — including Barclays Bank, Deutsche Bank, JP Morgan and Standard Chartered Bank.

The debentures carry a coupon rate of 10.75-12 per cent and have a tenor of 12-25 months and are secured by a pledge from Adani Group’s 74 per cent stake in MIAL and a charge on various assets.

“We are set to transform the Mumbai airport from a functional transit point into a vibrant, full-fledged business, hospitality and leisure ecosystem for Mumbaikars and the region,” said Prakash Tulsiani, chief executive officer of MIAL. 

“We are pleased to work with the Adani’s to provide a comprehensive, long-term capital solution for the Mumbai International Airport, a mission-critical infrastructure asset in India,” said Brigitte Posch, Apollo partner and global head of emerging market debt. “Amid significant market volatility, our ability to commit to the entire transaction and take a long-term view reflects some of the key strengths of Apollo’s global credit platform and perpetual capital base,” she added.