It’s finally official now, Adani Airport Holdings Limited took over the management control of Mumbai International airport. Adani group announced earlier in August 2020 that it plans to acquire debt-ridden GVK group’s stake in Mumbai Airport.
Adani Airport Holdings Limited (AAHL) is a subsidiary of Adani Enterprises Limited which is listed on both the Bombay Stock Exchange and National Stock Exchange. Adani group acquired 50.5% stake from GVK group which has built Mumbai Airport and the rest of the 23.5% stake from other minority shareholders, Airports Company South Africa (ACSA), and Bidvest Group taking its overall control to 74% in Mumbai’s Chhatrapati Shivaji Maharaj International Airport.
Adani Group Acquires Mumbai International Airport Officially
Gautam Adani, Group chairman of Adani Group made the announcement on his Twitter handle. He wrote, “We are delighted to take over management of the world-class Mumbai International Airport. We promise to make Mumbai proud. The Adani Group will build an airport ecosystem of the future for business, leisure, and entertainment. We will create thousands of new local jobs.”
We are delighted to take over management of the world class Mumbai International Airport. We promise to make Mumbai proud. The Adani Group will build an airport ecosystem of the future for business, leisure and entertainment. We will create thousands of new local jobs.
— Gautam Adani (@gautam_adani) July 13, 2021
The company has received the required approval from the Central government, State government, the City and Industrial Development Corporation (CIDCO) of Maharashtra. Mumbai airport is India’s second-largest airport in terms of passenger and cargo traffic just behind Delhi Airport.
“Our larger objective is to reinvent airports as ecosystems that drive local economic development and act as the nuclei around which we can catalyse aviation-linked businesses. These include metropolitan developments that span entertainment facilities, e-commerce and logistics capabilities, aviation dependent industries, smart city developments, and other innovative business concepts,” Adani said in the statement.
According to credit rating agency ICRA, the Airport sector is expected to incur a loss of more than 5400 crores this year because of the disruption caused by the Coronavirus pandemic. However, the Adani group believes that air travel in India and other parts of the world will make a strong comeback post-pandemic. Also, in the long run, cities of tomorrow will be built with airports as the focal point as economic value created by these cities will be maximized around airports. With this acquisition, AAHL will command a market share of 33 percent of total India’s air cargo traffic.
Adani Airport Holdings has been on an acquisition spree in the last 2-3 years with a market share of 25% of overall Airport footfalls in the country which makes it the largest airport infrastructure company in India. It has eight airports in its portfolio some of which are under development.
“Our airport expansion strategy is intended to help converge our nation’s Tier 1 cities with the Tier 2 and Tier 3 cities in a hub and spoke model. This is fundamental to enabling a greater equalization of India’s urban-rural divide, as well as making international travel seamless and smooth,” Adani added.
According to The International Air Transport Association (IATA), global passenger traffic is expected to reach 88 percent of pre-COVID demand by end of the next year 2022 and start growing in high single digits from 2023 onwards. India is on the path to become the world’s third-largest aviation market by 2024.
AAHL is simultaneously working on building the Navi Mumbai International Airport from August 2021 onwards which is expected to commission in 2024. The company is expecting to complete the financial closure by end of the second quarter.