Will go all guns blazing on Navi Mumbai airport: GVK

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GVKGVK Infra which operates the Mumbai International Airport or MIAL says that it will go all guns blazing to bid for the Navi Mumbai international airport. The state government of Maharashtra recently called for a request for qualification or RFQ for the construction of the much-delayed second airport in Mumbai.

“We will certainly bid for the project. We already have a right for first refusal or RoFR for the project, so we have a prize presence,” Issac George, the chief financial officer of GVK Infra said, in a analyst conference call.

The project had been delayed for many years the state government could not acquire the land required for the project. GVK, which already runs the domestic and international airports, was given an RoFR as they would lose some of their existing traffic. GVK will be asked to match the bid of the highest bidder for the project, and it shall pass on to others only if they refuse to do so.

George also said that they might have to wait a little longer for the project as the final bids for the project, are expected only in June. Spread over 1,160 hectares, the project would be one of the biggest airport projects to seek bids since the airport modernisation projects of Delhi, Mumbai, Bangalore and Hyderabad were awarded in 2005.

The Navi Mumbai airport project which is expected to be completed in four phases will cost as much as Rs. 14,574 crore. It will have two parallel runways of 3,700 meters of length.

GVK has also recently launched its new terminal at Mumbai international airport T2. It also plans to now commercialise as much as eight acres of land that belongs to the airport, in four parcels. This land which can translate into 1.8 million square feet of space is not as a part of the encroached land that is currently under dispute.

“We have some bids come in, which we have evaluated. We are in negotiations with the individual parties. We should be able to finalise in a week or so,” said George. The land is located in the lucrative Western suburbs of Mumbai. GVK got the right to monetise the land as it won the bid to develop the Mumbai airport.

The infrastructure company which has presence across sectors like power and transportation too, has a consolidated debt of Rs. 20,970 crore. It is also looking to reduce its debt by selling stake in the airports holding company. It owns and operates airports in Mumbai and Bangalore.

“We already got two binding term sheets from two investors,” said George, without revealing the names due to a confidential agreements that they have with them. The amount of investment and the extent of equity dilution too is under discussions, he said.