Singapore's Changi Airport makes fresh attempt to enter India

After several false starts, Singapore's Changi Airport is making a fresh bid to get a firm foothold in India, which has eluded it for many years. Changi Airports International (CAI), an arm of the Changi Airport Group, which runs the Singapore airport, is said to be in talks with Hyderabad-based GVK Group to acquire a stake in its lucrative airport business. GVK operates two of India's busiest airports in Mumbai and Bangalore, reports Business Standard.

If the deal goes through, the Changi-GVK combine will handle over 40 million passengers a year, making it the biggest player in India's airports market. Bangalore-based GMR Group, which operates the Delhi and Hyderabad airports, handles 37 million passengers a year. However, the alliance will have less capacity in India compared to GMR's. GVK can handle 51 million passengers a year, while GMR has a capacity to handle 72 million per annum. The Bangalore and Mumbai airports are collectively valued at close to Rs 13,000 crore at recent deal prices.

Changi has been looking to enter India for a while. It tied up with Bharti Group's Sunil Mittal to bid for the Delhi airport privatisation, but got cold feet in the last moment and dropped out of the race, according to people in the know.

It tied up with Tata Realty Infrastructure (Tatas had 51 per cent and the rest was with Changi) to bid for airport projects in India, especially in non-metros. It also made a bid few months ago to acquire Siemens' 14 per cent stake in the Bangalore airport. But GVK matched the offer and bought the stake.

The negotiations with GVK would be the Singaporean company's fourth attempt to make a comeback in India. Changi has till now concentrated on operations in Singapore. It has not spread itself overseas in a big way like many other airport operators, including Fraport and Zurich Airport.

GVK is also in talks with private equity firms to raise fund after it acquired 13.5 and 14 per cent in Mumbai and Bangalore airports, respectively, in the last few months. A deal with Changi will help GVK both in funds and technical expertise in bidding for the Navi Mumbai airport. The group has the first right of refusal for the Navi Mumbai airport bid.

According to aviation analysts, if the deal sails through, it would create a win-win situation for both companies. It would give Changi Airport a stake in running the Mumbai and Bangalore airports, India's second- and third-busiest airports. GVK has 50.5 and 43 per cent in the Mumbai and Bangalore airports, respectively.

However, CAI spokesperson Ivan Tan denied the development.