NIIF To Invest Rs6.75 Bn In Airport At AP

The greenfield airport at Bhogapuram, Andhra Pradesh is being developed by GMR Airports

GBS Raju, Business Chairman – Airports, GMR Group

FinTech BizNews Service

Mumbai, December 21, 2023: GMR Airports Limited (GAL), a subsidiary of GMR

Airports Infrastructure Limited, and NIIF (National Investment and Infrastructure

Fund) entered into binding agreements for NIIF to invest up to INR 6.75 billion in

GMR Visakhapatnam International Airport Limited (GVIAL), a special purpose

vehicle to develop and operate the Bhogapuram International Airport. This

investment is part of the financial partnership announced on 7 th  December 2022

between the parties, in relation to investment by NIIF in the equity capital of three

airport projects of GMR Airports Limited. This marks NIIF’s second airport

investment, after its investment in GMR Goa International Airport Limited, which

operates Manohar International Airport in Goa, was completed in April 2023.

GVIAL, in 2020, was awarded the concession to develop and operate the greenfield

Bhogapuram International Airport (BIA) to the north of Visakhapatnam under a 40-

year Design-Build-Finance-Operate-and-Transfer model. BIA, a part of the National

Infrastructure Pipeline, is poised to become the largest airport in the state of Andhra

Pradesh with a phase I capacity of up to 6 million passengers per annum and with an

ultimate capacity of up to 40 million passengers per annum. The transaction

envisages a primary investment by NIIF in the form of Compulsorily Convertible

Debentures (CCDs) to be issued by GVIAL. The transaction is subject to customary

completion of conditions precedent and necessary approvals.

BIA will provide vital infrastructure to deliver a world-class passenger experience in

Andhra Pradesh while significantly enhancing air travel potential in

the Visakhapatnam region. The project is well positioned to boost connectivity and

transportation infrastructure in northern Andhra Pradesh and also resonates with

national priorities of strengthening air travel penetration and connectivity, especially

to Tier 2 and Tier 3 cities. GVIAL shall be an important engine of Andhra Pradesh’s

economic development and growth over the medium to long term.

GBS Raju, Business Chairman – Airports, GMR Group, said, “It is a proud

moment for GMR Group to develop the greenfield Bhogapuram International Airport

in the State of Andhra Pradesh. We are confident that we will replicate the success

of our Hyderabad Airport and the new world class airport will act as the catalyst for

the socio-economic growth of the city and the State at large. The new Bhogapuram

airport and airport city will help in the transformation of Visakhapatnam and will place

it on the global map as the most preferred investment destination. Our growing

partnership with NIIF is a further testament of GMR’s credibility as an Airport

Infrastructure developer and the future of the Aviation industry in the country.”

Vinod Giri, Managing Partner – Master Fund, National Investment and

Infrastructure Fund Limited, said, “NIIF believes that Bhogapuram International

Airport will strengthen aviation infrastructure in Andhra Pradesh, playing a pivotal

role in the region’s economic progress in the coming years. NIIF’s Master Fund is

India’s largest infrastructure fund with a robust and well-diversified portfolio across

transportation, energy and digital infrastructure. NIIF’s investment in

GVIAL represents the Fund’s second airport project, underscoring our commitment

to participate in the implementation of Government of India’s ambitious National

Infrastructure Pipeline.”

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