ADAG eyes Prague airport upgrade
After losing out to Bangalore-based GMR group for the controversial Delhi airport modernization contract, Anil Dhirubhai Ambani group (ADAG) is now set to battle it in Prague, the capital of the Czech Republic, for which bids are shortly to be invited.
Late last week, Anil Dhirubhai Ambani group (ADAG) company Reliance Airport Developers Private Limited submitted an expression of interest to the Prague airport authorities. Sources said the ADAG company is willing to take a 100% stake in the airport or a strategic stake if the airport authority does not sell its entire shareholding. Significantly, GMR has shown interest in bidding for the same project.
Hyderabad-based GVK, which is modernizing the Mumbai airport, and Ruia-promoted Essar Techniques are reportedly the other prospective bidders. This is the first time that ADAG is looking overseas for an airport project. Sources familiar with the development said ADAG will have to pay between $4 billion and $5 billion for a total buyout. These sources said ADAG might consider tying up with an international company to bid for the Prague airport. An ADAG spokesperson declined to comment on the issue.
The Ruzyne International Airport is the biggest airport in the Czech Republic and is used as a hub for national carrier Czech Airlines and low-cost carriers like SkyEurope and Smart Wings. The airport currently has the capacity to handle 25 million passengers a year. The airport authorities are looking at upgrading the passenger terminal and the runway to handle additional traffic.
Several countries in Europe, notably in Eastern Europe, are opening up airports for privatization, providing airport infrastructure companies with new opportunities. GMR, for instance, has shifted its international business unit to London from India to track upcoming international airport projects. ADAG, on the other hand, has not had any major success in the airport development business especially after it failed to get either the Delhi or the Mumbai airport modernization project. It has, however, bid for many of the minor airports that have been opened up under public-private partnership and has been shortlisted for Udaipur and Amritsar. (Business Standard, India)
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