GVK eyes Siemens' 40% stake in BIAL

GVK Power & Infrastructure, which owns 29% in Bangalore International Airport (BIAL), plans to buy Siemens Project Ventures’ 40% stake in the airport and take majority control. The company would definitely want to acquire Siemens’ stake at Rs105 per share when they decide to exit. It has the first right of refusal.

While growth in Mumbai airport is a little limited due to land and runway constraints, Bangalore offers great growth opportunity. It makes ample strategic logic for GVK to enhance their stake in BIAL. It also enhances their credentials in going for global bids in the airport space.

Hyderabad-based GVK also plans to invest 1,000 crore in expanding and modernising existing facilities. Terminal 1 will be expanded to 17 million passengers by 2015 from the existing 10.5 million. Building a new terminal, T2, will take three-four years.

GVK emerged as the second-largest stakeholder in the company with a 29% stake earlier this year after acquiring 17% in BIAL from India’s largest engineering firm Larsen and Toubro (L&T ) for 686 crore at Rs105 a share.