Infrastructure Consulting & Management

GVK Airport : Mumbai

Presented By: Group 2

Manbir Wahan (F064)
Vrushank Paun (G005)
Aishwarya Mishra (I043)
Rakesh Raushan (I054)
Chirag Sanil (I057)
Agenda | Infrastructure Consulting & Management- Presentation

Introduction ( Background of
GVK & Mumbai Airport )
Bidding Process - Mumbai Airport

Bidding Process

Complications during Bidding Process

Timelines

Model Used

Post Bidding
Complications
Planned Vs. Actual

Recent Developments
 Introduction

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Introduction Complications Timeline Model Used
Process Complications Developments
Introduction | GVK Background
Gunupati Venkata Krishna Reddy (Dr GVK Reddy), is the Founder Chairman and Managing Director of GVK. A Hyderabad-based
leading Infrastructure publicly listed conglomerate with presence in India, Australia and Indonesia

Airports - India, Indonesia Taj Properties - AP, Telangana, Chandigarh, Mumbai,

Roads - Rajasthan, Gujarat Airport transit hotel in mumbai
Ports - Gujarat

CCPP (gas/naphtha-based),
thermal (coal-based) and GVK BIO – CRO
hydro power plants.

have projects in AP, Punjab

and J&K, Uttarakhand

Coal - Australia + Rail line

for pit-to-port GVK Operations

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Introduction | Mumbai Airport Background
 Formerly known as Sahar International Airport

 Second busiest airport in the country

 14th busiest airport in Asia

 28th busiest airport in the world

 Passenger traffic was about 49.8 million in year 2018

 Second busiest in the country in terms of cargo traffic also

 The world's busiest airport with only one operational runway at a time.

 Total land area of 750 hectares (1,850 acres)

 950 aircraft movements per day

 Cargo Capacity: 2005 – 5 lakh tonnes | 2015 – 7 lakh tonnes | 2019 – 1 million tonnes
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Introduction | Mumbai Airport Background …

 Along with IGI Delhi, it was adjudged the "World's Best Airport" at Airport Service
Quality Awards 2017 in the highest category of airports handling more than 40 million
passengers annually by Airports Council International

 Operated by Mumbai International Airport Limited (MIAL), a Joint Venture between

the Airports Authority of India and the GVK Industries Ltd led consortium which was
appointed in February 2006 to carry out the modernization of the airport

 The new integrated terminal T2 was inaugurated in January 2014 and has a
dedicated six lane, elevated road connecting the new terminal with Western Express
Highway

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 Bidding Process
GVK Airport - Mumbai

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Bidding Process | GVK Airport - Mumbai

Events during Bidding process:

1. Change in Government (May, 2004)

2. Formation of EGoM

3. Request for proposal (April 1, 2005)

4. Transaction documents submission

5. Bid Submission (September 14, 2014)

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Bidding Process | GVK Airport - Mumbai
• Winner: GVK Consortium
(GVK Industries Limited , Airports Company South Africa, The Bidvest
Group Limited)
Bid 38.7% revenue share
• Other bidders:
• GMR Consortium(33.03%)
• DS Construction Consortium(28.12%)
• Reliance Consortium (21.33%)
• Macquarie Consortium
• Essel - TAV Consortium

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 Complications during Bidding Process

Bidding Post Bidding Recent

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Complications during Bidding Process of Mumbai Airport

• Bidding was supposed to go on from May, 2004 to September, 2004 but got delayed to September, 2005

• Initially only GMR and Reliance had qualified post technical analysis, and after further evaluation only GMR
qualified, hence technical qualification scores were lowered

• Airport Authority of India (AAI) employees launched protest demonstrations in major airports.

• GVK had agreed to absorb a minimum of 60 per cent of employees working at the two airports, although
they were asked to take a minimum of only 40 per cent of the employees after a three-year period; The AAI
would retain 10-15 per cent of the workers

• Reliance filed a case against AAI and Union of India, 2nd Feb, 2006

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 Timeline | GVK Airport - Mumbai

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Timeline | GVK Airport - Mumbai
Phase 1 Phase 2 Phase 3

(Completed by 2008) (Completed by 2010) (Completed by 2014)

International car park expansion,
New high speed taxiways, Apron
expansion, New domestic
terminal car park, Resurfacing of
secondary runway 14/32 ,Crash
fire tenders and up gradation on
airport facilities
Amalgamation of Terminal 2B & Construction of New Integrated
2C, International terminal Terminal for Domestic &
expansion, Construction of New International - T2, Multilevel car
Domestic Terminal (T1C), parking for 5200 (approx.) cars ,
Construction of Apron, Parallel Sahar access road, Mithi river
taxiway to Runways 09/27 & Diversion, Construction of New T2
14/32, Upgrading Runway & Apron, Construction of ATC tower
Taxiways including RET to Code F
compliance

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 Model Used | GVK Airport -
Mumbai

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Model Used in GVK Airport - Mumbai
New Share holding- AAI(26%), GVK
In 2006, Mumbai International Airport
Holdings(50.5%), Bid Services (13.5%),
Pvt. Ltd. (MIAL), a joint venture between
ACSA Global (10%).
the GVK led consortium (74%) and
Airports Authority of India - AAI (26%)
MIAL was charged with the objectives of
The consortium consisted of- GVK
operating, maintaining, developing,
industries, Airport Company South Africa
designing, constructing, upgrading,
Limited and Bidvest group limited.
modernizing, financing and managing the
airport
Share holding- AAI(26%), GVK
Holdings(37%), Bid Services (27%), ACSA
Key objectives were the refurbishment of
Global (10%).
domestic terminals 1A & 1B, the
international terminals 2B & 2C and the
Subsequently 1,08,00,000 out of
opening of a brand new domestic terminal
50400000of Bid services were bought by
1C and terminal 2
GVK holdings

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Model Used in GVK Airport – Mumbai | Revenue Share
Revenue earned by AAI

The JVC shall also pay to the AAI an annual fee (“AF”) for each Year during the term of
this agreement of the amount set forth below:
AF = 38.7 % of projected Revenue for the said Year
Where projected Revenue for each Year shall be as set forth in the Business Plan.

Source: centreforaviation.com
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 Post Bidding Complications |
GVK Airport - Mumbai

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Post Bidding Complications in GVK Airport – Mumbai
1. Land Acquisition
• May 2006, AAI transferred 1,976-acre airport land to GVK for its
modernisation.
• But 276 acres had already been encroached upon and housed 275,000
to 325,000 slum dwellers who needed to be relocated.

• MIAL incorporated a parallel runway but there were obstructions to

this part of the land which included land acquisition and rehabilitations
of slum as well as relocation of a number of airport facilities.

• Had to implement a model Slum Rehabilitation scheme to move 85,000

slum dwellers
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Post Bidding Complications in GVK Airport – Mumbai
2. The Mithi River Problem
• The first and main runway was built across the Mithi
river.
• It crossed the river on a bridge with a culvert
underneath to allow the water to flow

• But due to monsoon rains in Mumbai that

continued 24/7 for 2 months, the airport land
including the runway frequently got waterlogged

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Post Bidding Complications in GVK Airport – Mumbai
3. Shifting of Shivaji Statue
• The Shivaji statue was falling in the footprint of the new
common user terminal
• Statue area was scheduled to be handed over by 31st March
2010.
• The approval from government for relocating the statue got
delayed by 17 months
• Affected area of 50000 sq. (approx.) works including the
structural works, concreting works and underground works
• Impacted the overall testing & commissioning, which led to
delay in project completion.
• On 27th August 2011, statue got relocated and the area was
handed over for construction.
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Post Bidding Complications in GVK Airport – Mumbai

Planned vs. Actual

Commitments As per MDP Actual Delivered
Completion March 2012 February 2014
Cost Rs. 9802 Cr ~ Rs. 12000 Cr
Area 450897 sqm 453357 sqm
Aircraft Parking Contact Stand: 30, Remote Stand: 14 Contact Stand: 25, Remote Stand:
stand 21
Car Parking Space 6000 5200

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 Recent Developments | GVK
Airport - Mumbai

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Recent Developments | GVK Airport – Mumbai
Share Holding Pattern
In 2011, GVKAHPL acquired 13.5% stake in MIAL from Bid service division (Mauritius) for a consideration of USD 231
million

Share holding pattern till 31st December 2018:

GVK Airport Holdings Limited: 50.5%
ACSA: 10%
Bidvest: 13.5%
AAI: 26%
Adani offered to buy 23.5% stake from ACSA and Bidvest in January

After that, in February & March, GVK acquired shares from ACSA and Bidvest for a consideration of approximately Rs.
2200 Cr which valued MIAL for Rs. 9500 Cr approximately

Now, Canada's PSP Investments, Abu Dhabi Investment Authority (ADIA), and India's NIIF are reportedly teaming up
to buy 49 percent of GVK Airport Holdings for Rs 6,000 crore

The deal will help GVK clear some of its debt, and fend off Gautam Adani's bid for Mumbai International Airport, which
values the company at Rs 9,500 crore
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Recent Developments | GVK Airport – Mumbai
Navi Mumbai airport
CSIA handled 45 million passengers while capacity is 40 million

The project is being executed as a PPP between GVK-owned MIAL and the City and Industrial
Development Corporation (74:26)

The first phase project cost is pegged at over ~14,000 crore and is being funded through equity
investment and ~10,300-crore long-term debt. While the state hopes the airport will be ready by mid-
2020, CRISIL in its report 2023

GVK offered Rs. 16000 Cr bid and 12.6% in revenue share to the project implementing authority, the
Cidco of Maharashtra ort in May-end had said operations are expected to start in 2023.

Phase I – 2020 – 35 million passengers

Phase II – 2022 – 55 million
Phase III - 2030 – 90 million projection by CIDCO

4 lakh direct and indirect jobs

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Thank You