Abu Dhabi Investment Authority agrees to buy stake in airport unit of Indian conglomerate GVK

Adia and India's National Investment & Infrastructure Fund to buy 49% stake in GVK Airport Holdings

Adia holds directly, or through its subsidiaries, investments across various asset classes including equities, fixed income, real estate and private equity.  Delores Johnson / The National.

Abu Dhabi Investment Authority (Adia) and India’s National Investment & Infrastructure Fund (NIIF) agreed to buy a 49 per cent stake in the airport unit of Indian conglomerate GVK Power & Infrastructure.

They signed a term sheet and exclusivity deal with GVK Airport Developers for an investment in new shares in GVK Airport Holdings, according to a statement from GVK Power & Infrastructure on Thursday.

"The funds brought in through this proposed transaction will help us deleverage as we continue with our endeavours to create the infrastructure for a strong aviation hub in India that will provide the impetus for growth and development for the entire country," said GVK Reddy, founder and chairman of GVK.

Adia ranks third among funds that invest on behalf of their governments - after Norway and China - with total assets of $696.6 billion, according to the Sovereign Wealth Fund Institute. It holds directly or through its subsidiaries investments across various asset classes including equities, fixed income, real estate and private equity.

GVK had initiated a process to identify and select preferred investors to raise capital to reduce or refinance debt obligations of up to 57.5bn rupees, the company said.

Adia and NIIF were selected as the preferred partners by GVK.

GVK will use all proceeds from the proposed transaction towards retiring debt obligations, it said.

"Our future focus will be on delivering Navi Mumbai International Airport, successfully monetising Mumbai airport’s real estate and building a strong airports business at GVK," Mr Reddy said.

Navi Mumbai International Airport  is a Public Private Partnership venture in which the GVK-led Mumbai International Airport  has a 74 per cent stake, according to GVK's website.

The Indian conglomerate operates in sectors including energy, transportation, hospitality and aviation.