Mumbai, Aug 31 (IANS): Adani Airport Holdings Ltd (AAHL) has entered into an agreement to acquire the debt of GVK Airport Developers Ltd, and in turn, will acquire controlling interest in the Mumbai airport.

In a regulatory filing on Monday, Adani Enterprises said as per the agreement, Adani Airport will acquire the debt of GVKADL from its lenders. The lenders include a Goldman Sachs-led consortium and HDFC.

The GVK Group and AAHL have agreed that AAHL will offer a stand-still pact to GVK, in addition, to release of the guarantee given by GVK Power and Infrastructure Ltd with respect to the debt acquired by it.

"The Adani Group will also take steps to complete the acquisition of a 23.5 per cent equity stake from ACSA and Bidvest in MIAL for which it has obtained the CCI's approval. Upon the acquisition of the debt of GVKADL, Adani Group will take steps to obtain necessary customary and regulatory approvals, as may be required, to acquire controlling interest in MIAL," the filing said.

GVKADL is the holding company through which GVK Group holds 50.50 per cent equity stake in the Mumbai International Airport Ltd (MIAL), which in turn holds 74 per cent equity stake in the Navi Mumbai International Airport Ltd.

It said that AAHL intends to infuse funds into MIAL to ensure that it receives much needed liquidity and also achieves financial closure of the Navi Mumbai International Airport to be able to commence construction.

In a statement, GVK said that the terms of cooperation also include releasing of the company of various obligations, securities and corporate guarantees given in respect of debt to be acquired by Adani.

"The ability for Adani to convert the acquired debt to equity of GVKADL on mutually agreed terms, subject to obtaining necessary regulatory approvals," it said.

Noting that the aviation industry has been severely impacted by Covid-19 and it has impacted the financials of Mumbai International Airport Ltd, G.V.K. Reddy, Founder & Chairman, GVK, said: "It was, therefore, important that we bring in a financially strong investor in the shortest possible time to improve the financial position of MIAL, as well as to help achieve Financial Closure of the Navi Mumbai International Airport project, which is a project of national importance."

He added that it is under these circumstances that GVK agreed to cooperate with Adani so as to achieve these twin objectives.

Further, when the transaction is consummated, which is subject to customary approvals, GVK would be reducing a significant portion of liabilities to its lenders, which is of utmost importance to the group, Reddy added.