GMR Group has signed a definitive agreement with MAHB to divest its 40 per cent equity stake in Istanbul Sabiha Gökçen(ISG) and LGM Tourism, for an amount of 225 million euros (nearly 1,910 crore), subject to certain adjustments, the company in a release said.
The transaction is subject to customary closing conditions, including the approval of the relevant government authorities and the project lenders to ISG, the statement said.
This is the second major divestment of overseas assets by the GMR Group in less than nine months. Earlier in March 2013, the Group had divested its stakes in GMR Energy (Singapore) Pve Ltd. The divestment of these two assets is estimated to release around Rs 3,500 crore of capital, simultaneously reducing an estimated Rs 5,000 crore of debt.
G M Rao, Group Chairman, GMR Group said, the transaction is yet another evidence of GMR Group's ability to implement appropriate strategy to face the challenges of changing times.
"We at GMR Group continue to focus on creating liquidity and enhance value by effective portfolio management under our ALAR (Asset Light Asset Right) Strategy. The efforts of the Group taken in recent times shall strengthen our Balance Sheet," Rao said.
The consortium of Limak Holding, GMR Group and MAHB was selected as the preferred bidder for upgrading and maintaining the airport in July 2007. GMR's equity investment at ISG is around 71.6 million euros.
Rothschild (India) Private Limited and White and Case LLP acted as Financial Advisors and Legal Counsels, respectively to GMR Group, the statement added.