Bangalore Airport’s Fairfax stake not for sale: Prem Watsa

BANGALORE AIRPORT

Prem Watsa, Chairman of the Toronto-headquartered Fairfax Financial Holdings, told ET that he has ruled out plans to sell its stake in the Bangalore airport.

Fairfax India Holdings Corporation is an investment holding company whose investment goal is to achieve long-term capital appreciation. They do this while preserving capital through investments in public and private equity securities and debt instruments in India and Indian businesses as well as other companies conducted in or dependent on India. 

Prem Watsa’s Fairfax India Holdings Ltd may list Bangalore International Airport as the subject of an IPO, which may value the asset at close to Rs 30,000 crore

Bangalore International Airport may be the subject of an Initial Public Offering (IPO) by Prem Watsa’s Fairfax India Holdings Ltd, which could value the asset at around Rs 30,000 crore. Fairfax Financial Holdings’ Indian subsidiary is collaborating with an advisor on a potential offering that might take place as soon as 2023.

Bangalore International Airport Ltd. (BIAL), a company established in 2001 to manage the Kempegowda International Airport under a 60-year concession, is majority owned by Fairfax India. Nearly 54% of the parent company is owned by Fairfax. The Karnataka State Industrial & Infrastructure Development Corporation and the Airports Authority of India each share a 13% stake, with private promoters holding the remaining 74%.

According to a Bloomberg article, the IPO may raise between Rs 3,000 crore and Rs 4,000 crore, and it may include approximately 75% primary shares and the remaining 25% existing shares. 

The people indicated that Fairfax could decide not to move forwards with the share sale because the developments are still in the early stages. According to later reports, Fairfax reportedly denied plans to sell its stake in the Bangalore airport.

Fairfax’s Prem Watsa reportedly refuted rumours that it will sell a share in the Bangalore airport

“Fairfax’s stake in Bangalore airport is not for sale. News reports claiming we are selling the airport are wrong.”

–Prem Watsa, Chairman of the Toronto-headquartered Fairfax Financial Holdings

According to Watsa, Fairfax is the airport’s controlling shareholder. The airport will keep growing until 2029 when it will be able to handle 90 million people yearly. It is being planned with regard to infrastructure. Plans for the airport city, which will cover 463 acres and include office parks, hotels, shopping, entertainment, medical tourism, and education, were presented by Watsa and BIAL Chief Executive Hari Marar.

Also read: Bangalore International Airport surpasses 250 million passenger count

Fairfax seized possession of the airport five years ago and has since invested Rs 12,500 crore in its improvement. Travellers may anticipate the new terminal opening in December. PM Modi inaugurated the new terminal of the airport a few days back.

Also read: Bengaluru airport set to open T2 in the first week of October; PM Modi to inaugurate

“I want to say this airport would not be possible if not for the leadership of the Honourable PM, Mr Modi.”

–Prem Watsa

BIAL Chief Executive Hari Marar claimed that over the next three years, he anticipates growth in the aviation industry. 

Also read: Kempegowda Airport is back to pre-covid passenger levels due to the high traffic volumes

“Passenger traffic has crossed pre-Covid levels, at least on the domestic front. International travel will also come back. It has supply-side constraints because of a lack of aircraft. We can expect 10-12% CAGR (compounded annual growth rate) in the next three to four years.”

–Hari Marar, BIAL Chief Executive

Watsa further stated that due to the success of the Bangalore International Airport and under Hari’s leadership, they anticipate expanding on additional infrastructure projects, notably airports.

(With inputs from Bloomberg and ET)

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