In-depth analysis of happenings:

What lead to the GVK-Adani deal, a hostile takeover.

The GVK group, which used to control the Mumbai International Airport Ltd. (MIAL) was facing a plethora of issues like:

• downgrades, defaults, and a severe cash crunch

• raids by the investigative agencies

• litigation by a minority partner

• pressure from its bankers and partners; and a powerful competitor waiting in the wings

Adani Group became India's biggest airport operator after GVK agreed to give away control of the Mumbai and the Navi Mumbai airport project to the conglomerate. The founder of GVK, which had been aggressively defending its airport business for a year getting into complicated legal wrangles to retain control, said it buckled under pressure from lenders and as the Covid-19 pandemic battered business. Adani Group will acquire all the debt on the books of GVK group’s subsidiary GVK Airport Developers, the airport holding company and subsequently, convert that into equity totaling 50.5% in MIAL.

In the board game Monopoly, a player must buy all railway stations to maximize his or her returns. Today, the role of airports in connecting people is rivalled only by the internet, a role that is likely to survive and thrive even as web interactivity soars. This view of the future could offer a context to explain the verve displayed by the Adani Group, an infrastructure major, as it moves into this field with big money. It recently bagged 50-year leases to operate six Indian airports: Ahmedabad, Lucknow, Mangaluru, Jaipur, Guwahati and Thiruvananthapuram.

With no clear path ahead of us, it is uncertain when the situation will stabilize for the aviation industry. Airlines depend on economies of scale to improve its profitability. If the Covid crisis stays longer, there would be a cascading effect. More operators are bound to face a cash crunch and there is a risk of them ceding control. How do you think the Adani Group will fare in this sphere in the long term?