Industrialist Gautam Adani's push for a toehold in the prestigious Mumbai airport to add to six airports already in his kitty has reached a watershed with time granted to archrival GVK Group ending on Thursday. The Adani Properties has sought before the court an extension of the deadline for closing the proposed acquisition of Bidvest's stake in GVK-controlled Mumbai International Airport Ltd (MIAL) by three months to February 2020, according to media reports.
The company is willing to deposit the entire amount in a no-lien bank account if the transaction deadline is postponed to February 7 from November 7, Darius Khambata, senior counsel for Adani Properties, said in the Bombay High Court on Tuesday, according to a report on the Economic Times website. MIAL's minority stakeholder Bidvest had agreed in April to sell its 23.3 per cent stake to Adani Properties by September 30 for Rs 1,235 crore. Adani Properties approached the court to restrain Bidvest from selling its stake to any other party while majority stake-holder GVK sought to enforce its right of first refusal to buy Bidvest's holding, the report said.
This is just an attempt by the petitioner (Adani Properties) to cut short my right of first refusal."
A single-judge bench is scheduled to take up the matter on Thursday. "We are seeking an injunction against Bidvest to sell their shares to anyone," Khambata told the court of judge AK Menon. "GVK has failed to purchase shares from Bidvest and the other stakeholder AAI (Airports Authority of India) has said it is not interested and hence there is nothing that can stop Bidvest from selling those shares to us"
The Adani company has also sought the appointment of Bidvest as the "constructive trustee" to make sure that GVK and the AAI abide by the right of first refusal to sell their stakes to them.
Moved arbitration tribunal
The GVK Group, on the other hand, said the company deposited the money in an escrow account on October 30. "This is just an attempt by the petitioner (Adani Properties) to cut short my right of first refusal," Ravi Kadam, senior counsel for GVK told the court. "The agreement between Adani and Bidvest clearly says that their right will kick in only if I fail to perform."
Bidvest approached the Delhi High Court following GVK's failure to close the deal within time and was allowed to move an arbitration tribunal, which gave GVK until October-end to make the payment. The arbitration tribunal has restrained Bidvest from selling the shares until November 24.
The GVK Group has raised over Rs 7,600 crore to reduce debt and acquire a 23.5 per cent stake in MIAL, according to a stock exchange filing on October 27. Currently, South African investors Bidvest and ACSA hold 23.5 per cent in MIAL, GVK owns 50.5 per cent and AAI owns the remainder, according to the report.