GMR puts airport hotel on the block yet again

GMR puts airport hotel on the block yet again
Highlights

GMR puts airport hotel on the block yet again. Infrastructure major GMR Group has put its hotel property at the Hyderabad International Airport on the block as a part of its asset light and asset right strategy.

The 305-room Novotel at Hyderabad airport is likely to fetch around `400 cr

Hyderabad: Infrastructure major GMR Group has put its hotel property at the Hyderabad International Airport on the block as a part of its asset light and asset right strategy. The 304-room Novotel Hyderabad Airport Hotel is expected to fetch anywhere between Rs 300-400 crore.

A file photo of Novotel  at Hyderabad International Airport

This is second time that GMR Group has put this luxury hotel property on sale under the Swiss Challenge model as it could not finalise the sale despite receiving some bids in 2013-14 fiscal.

“The GMR Hyderabad International Airport Limited (GHIAL) a step down subsidiary of GMR Infrastructure Limited (GIL) had initiated the process of divesting its equity stake in GMR Hotels and Resorts Limited or GHRL (that owns and manages the Novotel Hyderabad Airport Hotel), in the year 2013-2014 itself,” the infra major said in a release.

However, as no binding agreement could be reached with any of the bidders, GHIAL could not conclude the divestment process, it added. “In the meantime, GMR Airports Limited (GAL) had offered to acquire the GHIAL's stake in GHRL. The Board of GHIAL could not decide on the offer and suggested bidding process under Swiss Challenge method,” GMR explained.

Based on suggestion of the Board of Directors, the GHIAL has now recommenced the bidding process under a Swiss Challenge method, wherein the price offered by GAL earlier would be the floor price. “In this direction, the GHIAL has vide a newspaper advertisement on August 25, requested interested parties to submit their Expression of Interest (EoI) for acquiring 100 per cent equity stake in GHRL,” it said.

According to market experts, the valuation for the hotel property could be around Rs 1 crore per room under the prevailing conditions in the hospitality industry. So, GMR is likely to realise Rs 300 to 400 crore from the sale. “The bidding process is at a very early stage of calling for EoIs and based on any interest received over and above the floor price, GHIAL Board will take a suitable decision,” the infra group maintained.

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