GVK Power and Infrastructure Limited (GVK PIL) on Friday informed the stock exchanges that its step-down subsidiary GVK Airport Holdings Limited has initiated the process to acquire 120 million shares of Mumbai International Airport Limited (MIAL) constituting 10 percent of the paid up share capital of MIAL from ACSA Global Limited by exercising its right under Right of First Refusal in the shareholder agreement.

Last month, the company had exercised its right of first refusal to acquire 13.5 percent stake in MIAL from Bid Services Division (Mauritius) Limited (Bidvest) after Adani Group had proposed to buy out Bidvest's stake in response to a formal offer. The Adanis also made an offer to acquire ACSA's stake in MIAL around the same time.

With the exercise of first right of refusal for the acquisition of shares held by these two joint venture partners who decided to exit the company, GVK Airport Holdings' stake will rise to 74 per cent upon the completion of acquisition of their stakes from the present 50.5 per cent level.

As it was agreed to acquire the shares from Bidvest as well as ACSA at the rate of Rs 77 per share, GVK will require Rs 2,171.4 crore to pay for the acquisition of the 23.5 percent stake. It is not clear as to how the Hyderabad-based infrastructure conglomerate was planning to raise the amount to fund this acquisition.

MIAL is a public-private joint venture between GVK, Bidvest, ACSA and Airport Authority of India(AAI), which was awarded the mandate for operating and modernising the Chatrapati Shivaji International Airport(CSIA), Mumbai, in April 2006. The GVK-led MIAL had also received the letter of award for the development of green-field Navi Mumbai international airport project in October 2017.

The AAI, which holds 26 percent stake in MIAL will be the only other JV partner to bepost-acquisitionsition of stakes from Bidvest and ACSA by GVK arm in the Mumbai airport company.