Tata Group enters airport business, buys 20% stake in GMR infrastructure

A consortium of Tata Group and two foreign entities, Singapore’s sovereign wealth fund GIC and SSG Capital Management have agreed to invest Rs 8,000 crore ($1.2 billion) to buy around 20 per cent stake in GMR Airports, which runs India’s biggest airport. (Delhi International Airport). Post the deal, GMR Infrastructure and its units will hold about 54 % stake in the airports business, while the company’s Employee Welfare Trust will own 2%. Tata Group will hold about 20 %, with GIC and SSG holding stakes of about 15% and 10%, respectively.

Tatas would invest Rs 3,650 crore, while GIC and SSG will put in Rs 2,670 crore and Rs 1,780 crore respectively, making it possibly the largest foreign PE investment in India’s airports space.

According to a statement, the deal will pump Rs 1,000 crore into GMR airports as equity infusion, which will be used to retire the airport operator’s debt. The three investors will use the remaining ₹7,000 crore to buy GMR Airports shares from parent GMR Infrastructure and its units, which will also be used to pare debt.

This will mark the second corporate behemoth’s entry into India’s airport sector this year. Recently, the Adani Group won bids to operate five airports owned by the state-run Airports Authority of India across the country.