GVK Power share price surged over 10 per cent intraday on Monday after it informed bourses that the board has approved the sale of 33 per cent stake in Bangalore International Airport to FIH Mauritius Investments and Fairfax India Holdings Corporation for a consideration of Rs 2,149 crore.
Later, the share price of the company settled 6.43 per cent up at Rs 7.12.
In a BSE filing, GVK Power said, “Upon completion of the transaction, there would be a reduction in debt burden of around Rs 2,000 crore and would also result in saving of interest cost to the extent of around Rs 300 crore per annum. The transaction is expected to be completed by the middle of 2016.”
GVK Airport Developers, a wholly owned subsidiary of GVK Power & Infrastructure, had started a process last year to reduce its debt obligations to its lenders. The infrastructure major received multiple offer, from which Fairfax was selected.