GMR ready to buy out DIAL partners

GMR Group is willing to pick up the equity stakes of its joint venture partners - German airport giant Fraport and Eraman Malaysia - which want to pull out of Delhi International Airport Ltd (DIAL), the company that runs Delhi airport.

DIAL is a joint venture consortium in which GMR Group has about 54 per cent stake, the state-owned Airports Authority of India (AAI) has 26 per cent, and Fraport and Malaysian airport company Eraman Malaysia - through Malaysia Airports (Mauritius) Pvt Ltd - have 10 per cent each. GMR is the lead member of the consortium; Fraport AG is the airport operator and Eraman Malaysia the retail advisor. There are other minor investors, too.

A senior executive of GMR group confirmed that both the companies were keen to get out of the venture and GMR was willing to buy them out. Fraport has already closed its development office in India, after it said it was frustrated with the various hurdles in the country. Fraport's mandate as an operator ends in May next year. But it has shown keenness to sell its investment earlier.

In January 2006, the consortium was awarded the concession to operate, manage, and develop IGI Airport following an international competitive bidding process. DIAL entered into an operations, management, and development agreement with the AAI on April 4, 2006. The initial term of the concession is 30 years, extendable by a further 30 years.