GVK Power and Infrastructure Ltd Thursday said it agreed to offer 49 per cent stake in GVK Airport Holdings Ltd in favour of Abu Dhabi Investment Authority (ADIA) and the National Investment and Infrastructure Fund (NIIF).
In a filing with BSE, the city-based infra major said the transaction is subject to conclusion of confirmatory due diligence by ADIA and NIIF, agreement on definitive documents and satisfaction of customary closing conditions including regulatory and third party approvals and lender consents.
"GVK Airports Developer Ltd (GVKADL) and GVK Airport Holdings Ltd (GVKAHL), subsidiaries of out company have signed a term sheet and exclusivity agreement with the Abu Dhabi Investment Authority and the National Investment and Infrastructure Fund for an investment in new shares in GVKAHL equating to a 49 percent stake," the filing said.
However, the deal value was not disclosed.
GVKAHL holds 74 per cent equity stake in Mumbai International Airport Limited (MIAL).
The MIAL has been awarded a Greenfield airport project at Navi Mumbai.
"GVK had initiated a process to identify and select preferred investors to raise capital to reduce debt obligations of up to Rs 5,750 crore.
ADIA and NIIF were selected as the preferred partners by GVK.
All proceeds from the proposed transaction will be used by GVK towards retiring debt obligations," it said.
In the Annual General Meeting held last year, the shareholders gave nod to the Board to dilute equity stake, in GVKAHL, a step down subsidiary of the Company through an initial public offer or private placement or stake sale so as to utilise the proceeds for the repayment of the balance outstanding obligations of GVKADL.
It was also to meet other financial needs of the Company and its associate and group companies.