Groupe ADP is selling up to a 7.3 per cent stake in India’s GMR Airports for €924 million, allowing the founding family to regain control.
The founding family of India’s GMR Airports Ltd is significantly consolidating its control. They are repurchasing a major equity stake from French operator Groupe ADP. Under the agreement, ADP will divest up to 7.3 per cent of its holdings. The market values this multistage transaction at approximately €924 million. Equating to roughly $1.08 billion, the deal highlights shifting ownership dynamics.
ADP originally purchased a 49 per cent share in the airport operator during 2020. Now, the French group is gradually monetising this specific investment. ADP will sell an initial 3.4 per cent stake outright for €256 million. The European operator will also receive a strategic put option. Consequently, they can offload an additional 3.9 per cent for €285 million later.
The family’s investment vehicle has agreed to acquire key convertible bonds. These bonds carry a face value of €301 million alongside accrued transaction interest. Ultimately, both parties plan to complete this complex financial restructuring by March 2027.
Meanwhile, GMR Airports has witnessed substantial market growth recently. Company shares have surged by 8.4 per cent in Mumbai over the past year. This impressive performance gives the enterprise a $10.8 billion overall valuation.
ADP will firmly retain its core governance rights following the sale. Additionally, the foreign firm will maintain its status as a co-promoter. Company leadership indicated that this strategic move crystallises their initial investment value. They still retain massive economic exposure to the Indian asset’s future potential. However, the company does not plan to sell any additional shares at present.
Proceeds from this lucrative transaction will heavily fund short-term deleveraging efforts. Therefore, the corporate board has proposed a special dividend of €0.8 per share. ADP plans this financial payout for the upcoming 2025 fiscal year. Furthermore, shareholders might receive an additional €1 per share upon exercise of the option.
Citigroup Inc served as the primary financial adviser for Groupe ADP. S Associates, alongside Hogan Lovells, meticulously provided the necessary legal counsel. Urban Strategic Pte acted as the core strategic adviser.
(Source: Business Line)
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