Airport relinquish to Maldives Government
Singapore : In accordance with the Singapore Court’s decision, GMR will have to vacate Male airport and relinquish it to the Maldives government on Dec. 12 .Presidential spokesman, Imad Masood told the AFP news agency that the government would begin operating the airport, with a simple handing over ceremony.
Malaysia Airports Holdings Berhad took a joint contact with GMR back in 2010 for the 25-year running of Male airport, with GMR owning a 77% share and MAHB owing the remaining 23%.
The government said the deal had “legal, technical and economic issues”, and moved to cancel GMR’s allegedly void $500 million (£312 million) contract to manage the airport.
On November 27, the consortium received a government notice asking to hand over airport operations within one week. Singapore’s court soon issued a stay, but this was dismissed , giving the Maldives government permission to take control of the airport.
A GMR spokesman called the decision “unlawful” and “irrational”. Masood assured that all staff that wished to be retained would remain on the same salary, and GMR would receive compensation from the Maldives.
Maldivian Airport Company’s managing director, Mohamed Ibrahim, reassured international airlines that there would be no disruptions, describing the process as “seamless.”
Meanwhile, India has expressed fears that the move would send an adverse signal to foreign investors. According to a senior government official, there still remains no clarity on the concession agreement status, and the ministry legal team is still evaluating the court’s decision.
The compensation figure is heard to be anywhere between $220 million and $700 million. On Wednesday, GMR officials asserted the company was not in the wrong, and it wish to continue operating the airport. However, if compelled to seek compensation, the amount should be near $700 million.
As a result of the GMR row, India has frozen Maldives aid of Rs250 crore, which was a feature of a bilateral trade agreement. GMR Infra’s shares also took a 2% plunge after news of the Singapore Court’s decision.
The government take-over comes amid political feuds over control of the Maldives. Power was seized from the previous President, Mohamed Nasheed, back in February this year. However, the current government asserted that the president had just stepped down. – Airport International
