Adani Airports Holdings Limited (AAHL), a subsidiary of Adani Enterprises and recognized as India’s largest private airport operator, has made significant strides in financing the future of Mumbai International Airport Ltd. (MIAL) by successfully raising USD 1 billion. This considerable funding initiative is tailored to support the expansion and modernization of the airport, positioning MIAL to adapt to increasing air travel demands while enhancing passenger experiences.
The capital structure of this initiative includes USD 750 million in notes, due to mature in July 2029, accompanied by an option to secure an additional USD 250 million if necessary. This financing not only aims to refinance existing debt but also facilitates further capital expenditure that will be crucial for the airport’s future growth and operational enhancements.
Notably, this transaction marks a milestone as the first-ever investment-grade rated private bond issuance within India’s airport infrastructure sector. Such a precedent reflects a growing wave of international confidence in India’s infrastructure potential and underscores the robust operational framework established by Adani in managing airport services. The deal was primarily led by funds managed by Apollo, while also attracting notable participation from institutional investors, including funds managed by BlackRock and Standard Chartered.
The financial instruments issued are anticipated to carry a BBB-/stable rating, backed by MIAL’s strong asset base and dependable cash flow. Such ratings signify the financial health of the entity and its capacity to honor debt obligations, allowing AAHL to strategically push forward critical development initiatives at this vital transportation hub.
This funding endeavor is not limited to modernization and digitization; it also significantly emphasizes capacity upgrades, which are essential to efficiently managing growing passenger traffic. Furthermore, the investment aligns with MIAL’s ambitious goal of achieving net-zero emissions by 2029, thus integrating sustainability into its operational framework and aligning with global environmental trends.
Arun Bansal, CEO of Adani Airports Holdings Ltd., expressed that the successful issuance of these funds showcases the strength and resilience of Adani’s airport operating model, along with the solid fundamentals underpinning Mumbai International Airport. He reiterated the commitment to sustainable infrastructure development, an increasingly vital aspect in the context of environmental accountability in industry practices.
The legal architecture supporting this significant financing was meticulously crafted by prominent firms including Allen & Overy, Shearman & Sterling, and Cyril Amarchand Mangaldas for MIAL. Meanwhile, Milbank LLP and Khaitan & Co. represented the investors, ensuring that all regulatory and legal frameworks were upheld throughout the process.
This successful fundraising follows AAHL’s previous acquisition of USD 750 million from global banking institutions, reaffirming Adani’s capability to engage with international capital markets effectively. The implications of this funding are profound, indicating a decisive leap toward advancing infrastructural growth in India and establishing a template for future airport financing in the country.
As the aviation sector continues to recover and grow post-pandemic, such strategic financial maneuvers by major operators like AAHL are poised to set new standards in infrastructure development, benefiting both the industry and the broader economy.
