KUALA LUMPUR (Oct 25): Malaysia Airports Holdings Bhd (MAHB) has disposed of its 11% equity interest in GMR Hyderabad International Airport Ltd (GHIAL) for US$100 million (RM478.85 million) cash.

The airport operator told Bursa Malaysia on Wednesday that its wholly-owned subsidiary MAHB (Mauritius) Private Ltd had entered into a sale and purchase agreement with GMR Airports (Singapore) Private Ltd for the disposal of its entire 41.58 million shares in GHIAL. MAHB is expected to net a gain of US$23.70 million from the disposal.

According to MAHB, the principal activities of GHIAL are the provision of airport management services on build, own, operate and transfer, as well as operate-only models.

At present, GHIAL manages the operations of the Rajiv Gandhi International Airport in Hyderabad, India, and the Bidar Airport in Karnataka, India.

“The proposed disposal provides an opportunity to MAHB to dispose and unlock the value of its non-core assets, and streamline its overseas investment portfolio.

“Since the opening of the Rajiv Gandhi International Airport on March 23, 2008, MAHB had only received US$6.41 million of dividends from GHIAL.

“Hence, the proposed disposal enables the MAHB group to unlock its investment in GHIAL, as it only holds a minority stake, and does not exercise control, and would instead reinvest the disposal proceeds into assets where the group has more direct control of its investments,” it said.

MAHB said that it intends to utilise the proceeds for capital expenditure, general corporate purposes, and to defray the expenses in relation to the proposed disposal, which is expected to be completed by the first quarter of next year.

MAHB tried to dispose of its entire stake in GHIAL in January 2019, but the plan faltered as the share purchase agreement was automatically terminated, as the purchaser failed to complete its obligation in accordance with the terms of the agreement by Dec 31, 2018.

Shares in MAHB closed 12 sen or 1.66% higher at RM7.37 on Wednesday, giving the group a market capitalisation of RM12.30 billion.