ABU DHABI: The Abu Dhabi Investment Authority (ADIA), recognised as the largest sovereign wealth fund of the United Arab Emirates, has embarked on a significant investment strategy by committing approximately $750 million in the debt of India’s GMR Group.
The strategic move not only positions ADIA in one of the world’s most rapidly expanding aviation markets but also aids GMR Group in enhancing its financial stability and operational capacity.
GMR Group, which holds a substantial presence in India’s aviation sector, will utilise the funds from ADIA to refinance its external debt. This undertaking is crucial as it allows GMR Enterprises, the holding entity of GMR Group, to reduce its pledged shareholding in the airports business.
The ability to manage debt efficiently is paramount for GMR Group, especially as it aims to solidify its operational framework amid growing competition and expanding market dynamics.
Airport traffic
According to GMR Group’s latest annual report, the organisation has witnessed a four per cent increase in total debt, amounting to approximately Rs44.77 billion ($532.5 million).
The investment from ADIA is expected to play a pivotal role in addressing this debt, positioning GMR Group to better support the expected surge in domestic passenger traffic, projected to double to 300 million by 2030.
This aligns seamlessly with India’s vision for infrastructural and economic growth, particularly in the aviation sector.
Kiran Grandhi, Corporate Chairman of GMR Group, emphasised the significance of this investment, stating that it would strengthen the company’s capacity to foster the continued growth of GMR Airports.
“The partnership not only reflects ADIA’s strategic investment interests but also underscores the potential for collaborative growth between the UAE and India.”
