The Adani Group’s plans to acquire stake in the Mumbai airport has hit another roadblock with a tribunal restraining Bid Services Division (Mauritius) from selling its 13.5% stake in the airport till arbitration proceedings are completed, sources said.
The order comes after India’s apex court had last month directed the tribunal to decide by January 27 on whether the GVK Group is in a position to buy Bidvest’s stake in Mumbai International Airport (MIAL).
A copy of the tribunal order has been reviewed by FE. “It is directed that pending the hearing and final disposal of the arbitration proceedings, Bid Services or anyone acting for and on behalf of or under Bid Services is restrained from alienating, by way of transfer to anyone, or in any manner encumbering it’s 16,20,00,000 equity shares in Mumbai International Airport Limited… till disposal of the arbitral proceedings except with the leave of the arbitral tribunal or pursuant to directions of the arbitral tribunal,” the order said. GVK did not respond to FE’s queries till the time of going to press.
The Adani Group and GVK Group have been engaged in legal battle since April 2019, after Bid Services entered into a share purchase agreement with the Adanis to sell its entire stake in MIAL. GVK had approached the Delhi High Court seeking to restrain the sale of shares claiming its right-of-first-refusal (RoFR). The matter was referred to a three-judge arbitral tribunal, headed by retired Justice Mohan B Lokur.
In September 2019, the tribunal had temporarily restrained the stake sale and had directed the GVK group to prove its intention of exercising the RoFR. This was followed by the Adanis moving the Bombay High Court seeking to restrain GVK Airport Holdings from purchasing Bidvest’s stake in MIAL. The Bombay HC had refused the interim relief sought by Adanis, after GVK Airport Holdings informed the court it had submitted around Rs 1,250 crore in an escrow account, showing its serious intent for the purchase of Bidvest’s stake. The dispute then moved to Supreme Court, which directed the tribunal to come to a decision in a time-bound manner.
While proceedings on the matter will continue, the share purchase agreement signed between Adanis and Bidvest in March 2019 can no longer be executed, a lawyer with knowledge of the matter said. Bidvest has the option to appeal this order in the Delhi High Court, he added.
The arbitration tribunal is yet to decide whether the deposit of over Rs 1,250 crore made in an escrow by GVK Airport Holdings, which currently holds 51.5% stake in MIAL for the purchase of Bidvest’s shares is compliant with its earlier order. The current order is subject to GVK’s compliance of the September order passed by the tribunal.
“We are happy that the honourable tribunal has ruled in our favour. Currently, we are in discussions with our lawyers for the future course of action and hence it will be a bit premature to share any further details,” a GVK spokesperson said in response to FE’s queries.
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Source: Financial Express