GMR & MALDIVE case study

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GMR & MALDIVE case study

  1. 1. … The Air Controversy GMR & Maldives K h a r g h a r SMBA 30-B Group -1- -case study analysis… Presentation By: Sanjay Kumbhar (Roll No 107) Athira Nair (Roll No 79) Pradip Nevarekar (Roll No 108) Rachita Jain (Roll No 67) Namita Shinde (Roll No 72) Madhu Jaiswal (Roll No 80) J.Ranjam (Roll No 120)
  2. 2. … The Air Controversy GMR & Maldives -case study analysis… *** Flow of Presentation *** K h a r g h a r Introduction - Rachita Bidding Process -Pradip Award of Contract -Namita What Went Wrong? – Athira Perception from Maldive Govt.- Ranjan Perception from Indian Govt.– Madhubala Arbitration claim- Sanjay SMBA 30-B Group -1- Conclusion
  3. 3. … The Air Controversy GMR & Maldives -case study analysis… *** Introduction *** K h a r g h a r • Introduction • Reason • Purpose • FAA with IFC & World Bank • Contents of FAA SMBA 30-B Group -1-
  4. 4. … The Air Controversy GMR & Maldives -case study analysis… *** Bidding Process *** K h a r g h a r competitive bidding process. 1- IFC agreement 28/7/09 2- Transaction Structure Report 3- Announcement 6/10/09 4- EOI acceptance 5- Sending RFQ 23/12/09 6- Pre-qualification Application acceptance 17/1/10 7- Pre-qualification evaluation 20/1/10 SMBA 30-B 8- Sending of RFP/IM 18/3/10 9- Bid opening 20/6/10 Group -1- 10- Bid Evaluation 24/6/10 11- Signing the agreement 28/6/10
  5. 5. … The Air Controversy GMR & Maldives -case study analysis… *** Award of Contract *** K h a r g h a r SMBA 30-B Group -1- Introduction- GMR & MAHB. Contract Duration- 25 years Contract Value- $511 million Terms & Conditions- ADC
  6. 6. … The Air Controversy GMR & Maldives -case study analysis… *** What Went Wrong in Male ? *** K h a r g h a r SMBA 30-B Group -1-
  7. 7. … The Air Controversy GMR & Maldives -case study analysis… *** Perception of Maldive Govt. *** K h a r g h a r Failure to renegotiate terms Not a valid agreement,“ ADC not authorised by the parliament. Non-reversible & Non-negotiable decision Deter potential investors - down a path to economic ruin. GMR’s due diligence Fooled and cheated. Illegal SMBA 30-B Group -1-
  8. 8. … The Air Controversy GMR & Maldives -case study analysis… *** Perception of Indian Govt. *** K h a r g h a r SMBA 30-B Group -1- Very negative signal to foreign investors & international community Freeze $25-million annual aid to the country We are not happy Impact on our bilateral ties Maldivian foreign minister Abdul Samad Abdullah, Salman Khurshid & Prime Minister Manmohan Singh
  9. 9. … The Air Controversy GMR & Maldives -case study analysis… *** Legality & Arbitration *** K h a r g h a r Maldives terminates GMR's airport contract (27th Nov’12) The airport was taken over by the Maldives Airports Company Limited after a high-voltage legal tussle in which GMR had initially got a stay order on the termination from the Singapore High Court. GMR approach Singapore court against Maldives Govt , claims $800 Million Feels  SMBA 30-B -1- Agreement had stated that GMR should be given a 30-day notice of termination, the government believed that it need not be followed since the contract was void.  Group Cheated -contract cancelled over an illegal component –ADC The government has given a seven day notice to GMR to leave the airport,“.
  10. 10. … The Air Controversy GMR & Maldives -case study analysis… *** Conclusion *** K h a r g h a r SMBA 30-B Group -1- June 17, 2013GMR gets clean chit from Maldives probe agency in Male airport case because i) Concrete record on the concession agreement. & ii) No corruption was found in the bid evaluation ph June 21, 2013GMR sue has sought a compensation of $1.4 billion for the “wrongful termination” of its 25-year contract to develop and operate the Male International Airport. The figure of $1.4 billion was reached after taking into account loss of profit, payments made to sub-contractors besides others.  Sept 21, 2013 MALE (MALDIVES)Maldives Govt welcomes & encourages FDI- Foreign Direct Investment, but differed on the issue of the ousted Male airport operator GMR.  Wrong Signal, Image Damage, Power to economy- Tourism, the country is desperately trying to attract FDI for building its infrastructure. It can hardly be disputed that treating the largest FDI investor in such a
  11. 11. … The Air Controversy GMR & Maldives K h a r g h a r SMBA 30-B Group -1- -case study analysis…

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