Tatas check into airport business, buy stake in GMR as part of consortium

The GMR group is selling 46 per cent share in its airport business to a three-member consortium that includes the Tatas in Rs 8,000-crore deal to reduce its debt. The deal will give India's largest conglomerate indirect stakes in seven airports in India and abroad. The deal values GMR's airport business at Rs 22,475 crore. The Tata group runs airlines, charters and aviation catering business but its efforts to own and operate airports were unsuccessful till now. It had expressed interest for Navi Mumbai airport and projects but did not bid for them. While GMR had been in discussions with Singapore’s GIC and SSG Capital Management to sell stake in airports for a while, Tatasjoined the fray two months ago. On Wednesday, the GMR group said it had signed a binding term-sheet with the three entities to sell stake in GMR Airports Limited (GAL), its holding company for airports. The deal includes fresh share sale of Rs 1,000 crore to new investors and secondary sale share of Rs 7,000 crore. Tatas will own 20 per cent stake while GIC and SSG will hold 15 per cent and 10 per cent, respectively. While GMR will retain management control, new investors will get board seats. GMR will give an exit to private equity investors who own 5.8 per cent stake in GAL.