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GVK inks agreement with Indonesian airport authority

Source : BUSINESS_STANDARD
Last Updated: Thu, Nov 08, 2012 19:30 hrs

The Hyderabad-based GVK Power and Infrastructure Ltd on Thursday signed an operations and management contract with the Indonesian airport authority (Angkasa Pura Airports), the Southeast Asian country’s state-run airport operator.

The scope of the contract includes managing non-aeronautical commercial operations at both the existing terminals and the new international terminal of Indonesia's second busiest Bali (Denpasar) international airport, which is under construction. The airport is expected to open in the third quarter of 2013 with a major makeover.

According to GVK, Bali airport reported a passenger traffic of 12.1 million in 2011 and this is expected to grow 10-12 per cent a year.

According to the contract, the Indonesian airport authority will continue to own the 24,000-square metres of commercial area of the airport, which will be managed by GVK. It is the responsibility of GVK, which has a revenue share agreement with the airport authority, to generate and maximise the non-aero revenue. Besides revenue share, GVK will get a management fee.

“This development is a true testament to GVK's established track record in the operation and management of India’s leading airports in Mumbai and Bangalore. We are committed to bring our expertise and experience in transforming the Denpasar international airport as well,” GVK Power Chairman GVK Reddy said in a press release.

GVK is also developing an international airport in Yogyakarta in central Java in collaboration with the Indonesian government. This follows the memorandum of understanding that GVK had signed in January 2011 with the local government.

GVK's two airports in Mumbai and Bangalore together handled passenger traffic of about 44 million in 2011-12, making it the country’s largest airport operator in the private sector.

GVK Power’s scrip ended trade at Rs 12.81 on BSE on Thursday, down 1.91 per cent over the previous close of Rs 13.06.




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