GMR Airports, a major player in India's aviation infrastructure sector, has successfully raised Rs 6,000 crore through non-convertible debentures (NCDs) to refinance its existing liabilities. This strategic move is expected to significantly reduce the company's average borrowing costs by nearly 300 basis points.

Fundraising Structure

The fundraising initiative is structured in two tranches:

1. Bank Tranche: Rs 4,200 crore raised from banks including Barclays, Deutsche Bank, and JP Morgan at an interest rate of approximately 10.50% for a 3-year term.

2. Mutual Fund Tranche: Rs 1,800 crore raised from mutual funds including ICICI Prudential AMC, HDFC AMC, UTI AMC, and SBI Mutual Fund at around 10.35% for an 18-month term.

Financial Impact

This refinancing effort is set to have a substantial impact on GMR Airports' financial structure:

• Debt Reduction: The company currently holds Rs 6,100 crore in non-convertible bonds.
• Repayment Schedule: Rs 5,000 crore is due for repayment in November 2026, with the remaining Rs 1,100 crore due in February 2028.
• Cost Savings: The new NCDs are expected to lower the average borrowing cost by approximately 300 basis points, potentially leading to significant interest savings.

Credit Rating

Crisil, a leading credit rating agency, has assigned an A+ rating to the newly issued NCDs, reflecting confidence in GMR Airports' financial stability and repayment capability.

Company Overview

GMR Airports owns and operates major Indian airports, including those in Delhi and Hyderabad. These airports serve as critical infrastructure hubs for the country's aviation sector.

This refinancing initiative underscores GMR Airports' proactive approach to managing its financial obligations and maintaining investor confidence in its operations and growth strategies.

GMR Airports, a leading player in the aviation sector, has made a strategic move to expand its international footprint and diversify its non-aviation business. The company recently announced that its unit has acquired a 60% stake in a Greek operation, focusing on the development of non-aeronautical businesses at Crete Airport, also known as the New Heraklion International Airport at Kasteli, Greece.

Strategic Acquisition Details

According to a regulatory filing by GMR Airports Limited, its wholly-owned step-down subsidiary, GMR Airports Greece Single Member S.A. (GAGSMSA), has incorporated and acquired GMR Terna Commercial S.A. (GTCSA). The acquisition involves:

• Subscription of 600,000 shares
• Price per share: €1
• Total investment: €600,000 (approximately ₹6.00 crore)
• Ownership: 60% of GTCSA's paid-up share capital

Expansion of Non-Aviation Business

GTCSA, a limited liability company incorporated in Athens, Greece, will be responsible for undertaking non-aeronautical businesses at the Crete Airport. This move aligns with GMR Airports' strategy to grow its international airport operations beyond traditional aviation services.

Strategic Implications

The acquisition is expected to:

• Complement GAGSMSA's existing business related to the development, operation, and maintenance of the Crete airport at Kasteli
• Strengthen GMR Airports' airport adjacencies and airport-related businesses

Transaction Details

Key points about the transaction include:

• Not considered a related party transaction
• No direct interest held by the promoter/promoter group of GMR Airports, beyond their existing indirect shareholding in GAGSMSA
• No governmental or regulatory approvals required for this acquisition

Future Outlook

While GTCSA is yet to commence its business operations, this strategic move positions GMR Airports to capitalize on the growing non-aviation revenue streams in international airports. The expansion into the Greek market could potentially open doors for further opportunities in the European aviation sector.

As GMR Airports continues to expand its global presence, this acquisition marks a significant step in diversifying its portfolio and strengthening its position in the international airport operations landscape.