Indian infrastructure group GMR Infrastructure and GMR Airports (GAL) agreed to a settlement of their arbitration dispute with private equity investors SBI Macquarie, Standard Chartered and JM Financial-Old Lane.
“The deal structure was unique,” said Manish Gupta, a partner at Link Legal, the adviser to GMR Group in both the arbitration and the settlement proceedings. “It involved complex structuring to provide a partial exit to the existing investors by way of a cash payout, conversion of some of their existing securities into equity shares, as well as issuance of non-convertible debentures.”
In accordance with the settlement agreement, all parties decided to withdraw the ongoing arbitration. The investors and certain affiliates would acquire a 5.86% equity stake of GAL at an enterprise valuation of ₹210 billion (US$2.9 billion) and receive a payment of ₹35.60 billion in lieu of their entire compulsorily convertible preference shares (CCPS). GMR received the consent award from the arbitral tribunal based on the settlement agreement.
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