Tatas, Essar, two foreign firms queue up for Lucknow, Chennai airport operations

Sep 26 2013, 08:58 IST
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SummaryPrivate developers will have to invest Rs 500 cr and Rs 1,200 cr for further development of two airports.

The government’s plan to hand over the operations of Chennai and Lucknow airports to private firms has generated interest among top rung infrastructure firms of the country, including the Tata group, Essar group and existing operators GVK and GMR, sources in the civil aviation ministry said.

Two foreign airport operators, German firm Fraport AG and Turkish firm Celebi have also met aviation ministry officials as part of preliminary meetings before the bidding stage.

As per the request for qualification (RFQ) documents inviting interested parties for operation, management and transfer of Lucknow and Chennai airports, the private developers will also have to invest R500 crore and R1,200 crore, respectively, for further development of the two airports.

The civil aviation ministry last month invited interested parties with the qualification stage ending on October 18. As per the bid conditions, the interested parties need to have five years of experience in operations and management of airports.

While GMR and GVK satisfy that requirement and can go in for the bid alone, Tata group and Essar would require a foreign partner and bid as a consortium.

Since 2007-08, a GMR-led consortium has been operating the Delhi and Hyderabad airports while a GVK-led consortium has been operating the Mumbai and Bangalore airports.

Fraport with revenues over 2 billion euros is one of Europe’s largest airport operators and has partnered GMR in operations of the Delhi airport.

However, last year the German-company opted to exit the consortium at Delhi International Airport. Celebi Holdings is a Turkish airport operator and already manages the cargo terminal at Delhi.

“The meetings were preliminary in nature and the final contours of the consortiums will only be clear once the formal applications start coming in,” said a senior official at the civil aviation ministry.

Following the qualification stage, the bid documents for the two airports would go on sale by the last week of October. The timeline prescribed in the RFQ documents suggest that the bidding process will be completed by the last week of January and concession agreements would be signed within 30 days after completion of the bidding.

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