New Delhi: Airports Authority of India (AAI) will soon start pulling out of joint venture (JV) airports and the government has decided to sell its stake in them.
AAI has a 26% stake each in the Delhi and Mumbai joint venture airports and 13% in Hyderabad and Bengaluru.
Sources say the aviation ministry has moved a cabinet note to sell AAI’s stake and the process will start from Bengaluru and Hyderabad first.
Mumbai and Delhi may follow in the second phase.
The AAI board had earlier this month approved a plan to privatize 13 more airports by linking seven smaller airports with six major ones, which are going to bid for PPP mode.
The pairs are: Varanasi with Kushinagar and Gaya; Amritsar with Kangra; Bhubaneswar with Tirupati; Raipur with Aurangabad; Indore with Jabalpur and Trichy with Hubli.
Sources say, “The cabinet note is in the final stages of finalization for taking approval on this.”
According to National Asset Monetization Pipeline Recently drafted by NITI Aayog, the government aims to raise Rs 20,782 crore through aviation assets in FY 22-25 by privatization of 25 AAI airports and selling AAI’s stake in joint venture airports.
Out of this total amount, “Rs 10,000 crore of monetization value on account of disinvestment of AAI’s stake in private joint venture airports has been considered provisionally. It has been phased out equally in FY22 and FY23… Actual realization from AAI stake sale will depend on several factors such as timing of transactions, market conditions, investor appetite and transaction terms…. During FY 22-25, a monetization value of Rs 10,782 crore has been considered on account of estimated capex for the identified airports,” the NITI Aayog document said.
The total airport assets for monetization is about 18% of AAI’s total airport assets. Since the scale is important for investor interest, airports with annual traffic of more than 4 lakh passengers in FY 2019 and 2020 have been considered.
This is the first time that smaller airports are being clubbed with larger airports, opting for the PPP mode in which a private player develops and expands the airports on a revenue sharing model while the ownership remains with the government.
The airports developed and operated on PPP mode so far include Hyderabad, Bengaluru, Delhi, Mumbai, Kochi, Ahmedabad, Lucknow and Mangaluru. Adani Group will soon acquire Jaipur, Guwahati and Thiruvananthapuram airports and will also build Navi Mumbai airport.
All these airports were privatized on a standalone basis. The promoter of Mumbai Airport gets the right to build Navi Mumbai as Mumbai International Airport Limited has won that bid.
AAI has a 26% stake each in the Delhi and Mumbai joint venture airports and 13% in Hyderabad and Bengaluru.
Sources say the aviation ministry has moved a cabinet note to sell AAI’s stake and the process will start from Bengaluru and Hyderabad first.
Mumbai and Delhi may follow in the second phase.
The AAI board had earlier this month approved a plan to privatize 13 more airports by linking seven smaller airports with six major ones, which are going to bid for PPP mode.
The pairs are: Varanasi with Kushinagar and Gaya; Amritsar with Kangra; Bhubaneswar with Tirupati; Raipur with Aurangabad; Indore with Jabalpur and Trichy with Hubli.
Sources say, “The cabinet note is in the final stages of finalization for taking approval on this.”
According to National Asset Monetization Pipeline Recently drafted by NITI Aayog, the government aims to raise Rs 20,782 crore through aviation assets in FY 22-25 by privatization of 25 AAI airports and selling AAI’s stake in joint venture airports.
Out of this total amount, “Rs 10,000 crore of monetization value on account of disinvestment of AAI’s stake in private joint venture airports has been considered provisionally. It has been phased out equally in FY22 and FY23… Actual realization from AAI stake sale will depend on several factors such as timing of transactions, market conditions, investor appetite and transaction terms…. During FY 22-25, a monetization value of Rs 10,782 crore has been considered on account of estimated capex for the identified airports,” the NITI Aayog document said.
The total airport assets for monetization is about 18% of AAI’s total airport assets. Since the scale is important for investor interest, airports with annual traffic of more than 4 lakh passengers in FY 2019 and 2020 have been considered.
This is the first time that smaller airports are being clubbed with larger airports, opting for the PPP mode in which a private player develops and expands the airports on a revenue sharing model while the ownership remains with the government.
The airports developed and operated on PPP mode so far include Hyderabad, Bengaluru, Delhi, Mumbai, Kochi, Ahmedabad, Lucknow and Mangaluru. Adani Group will soon acquire Jaipur, Guwahati and Thiruvananthapuram airports and will also build Navi Mumbai airport.
All these airports were privatized on a standalone basis. The promoter of Mumbai Airport gets the right to build Navi Mumbai as Mumbai International Airport Limited has won that bid.
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