GVK's tussle with Adani group over airport stake

This is not the first time that GVK Group has landed in problems with regard to Mumbai International Airport (MIAL), the group's flagship airport venture. It has locked in a legal battle with Adani Group over stake sale in the country's second busiest airport.

GVK resisted Adani's bid to buy out 13.5 per cent stake held by its South African JV partner Bidvest in MIAL. Adani Group entered into a share purchase agreement with Bidvest in March 2019 for buying the latter's entire stake in MIAL for Rs 1,248 crore. However, GVK Group did not allow the deal to go through as it wanted to buy the stake, and so exercised its first right of refusal.

Following this, Adani dragged the issue to arbitration tribunal which gave GVK time till October 31 last year to pay Bidvest if it wanted to buy the stake. Adani also moved the Bombay High Court in September last year, seeking execution of its agreement with Bidvest. The Bombay HC in turn asked GVK to close its deal with Bidvest by November 7, 2019.

Meanwhile, arbitration tribunal appointed by Delhi High Court issued an interim order in January this year, restraining Adanis from buying the Bidvest stake. Further, on January 29 this year, Supreme Court refused to give any relief on the tribunal's interim order.

Even as the legal battle between GVK and Adnani was going, GVK Group received notice from corporate affairs ministry (MCA) in October last year, seeking some details about the airport operator following a whistleblower complaint.

Adani Group, which is betting big on airports sector, won the bids to run six Airport Authority-built non-metro airports in Lucknow, Jaipur, Guwahati, Ahmedabad, Thiruvananthapuram and Mangalore. However, its bid to enter the country's second busiest airport by buying out Bid Services Division Mauritius (Bidvest) from MIAL was stalled after GVK chose to exercise its first right of refusal, and matched the offer that the Adanis made to the Bidvest.