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GVK sells its 10% residual stake in Bangalore Airport to Fairfax India for Rs. 1290 crore

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GVK Power and Infrastructure Ltd today announced its decision to sell its residual stake of 10% in Bangalore International Airport Limited (BIAL), held through its subsidiary, Bangalore Airport Infrastructure Developers Private Limited, (BAIDPL) to Fairfax India Holdings Corporation for a consideration of Rs 1,290 crore (approximately $200 million). 
 
The transaction is expected to be completed by early July 2017. The proceeds of this sale are to be used for further reducing the debt obligations of GVK, a press release from the company said.
 
In March 2017, GVK closed a deal which was signed during March 2016 with Fairfax India to sell a 33% stake in BIAL. It had retained a 10% stake and the management of BIAL.
 
Dr. G V K Reddy, Founder Chairman & Managing Director of GVK, said, “Notwithstanding this sale, the airports sector will continue to be a core focus area for GVK. We had entered BIAL in 2010 when the airport was going through a tough phase as the capacity was severely constrained. Over the last seven years, we have worked very hard to transform BIAL into a world-class airport. The airport is now ready for another phase of expansion with a new runway and a new terminal to be constructed. However, we have decided to part ways with BIAL as deleveraging is top priority.”
 
“Our immediate focus will now be on Mumbai and Navi Mumbai airports and on selectively evaluating privatisation opportunities. The reduced debt burden gives us flexibility and releases management bandwidth to focus on these projects. Capacity optimisation and real estate development will be the key focus areas for the existing Mumbai airport. Having won the bid for the Navi Mumbai airport, we are excited to deliver yet another world-class airport. The Government’s focus on developing the aviation sector also presents attractive growth opportunities and we are evaluating these,” said Dr. Reddy.
 
“I would like to thank the Government of Karnataka, the Government of India, AAI and all the stakeholders for working closely with GVK over the last seven years in creating a world class airport that will continue to keep pace with the growing demand of Bengaluru in the coming years. We also wish the incoming shareholder, Fairfax India, the very best in maintaining the momentum to take the airport to even greater heights, ” he added.                                                                                                      
 
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