The Supreme Court on Tuesday refused to give any relief to South African firm Bid Services Division (Mauritius)-a subsidiary of Bidvest Group-and asked it to move the Delhi High Court against the arbitration tribunal’s interim order that restrained it from transferring its 13.5% stake in GVK Airport Holdings, the main holding company for the Mumbai International Airport (MIAL).
A Bench led by Justice R Bhanumati, while disposing of the Bid Services' plea, asked it to move the HC against the order of the arbitral tribunal, which had restrained any transfer of stake till "final disposal" of the arbitration proceedings. It also urged the HC to expeditiously consider Bid Services' plea for interim relief.
The HC had in July last year allowed Bidvest to sell its stake in MIAL to a third party, paving the way for the Adani group to make investment in the airport. Adani has been eying to pick stake in MIAL to mark its foray into the airport business. The share purchase agreement in this regard was entered on March 5, last year between Bidvest and Adani.
However, the group has not been able to go ahead with the sale as the GVK Airport Holdings, an arm of GVK Power and Infrastructure, had objected, saying it has the ‘right of first refusal’ to purchase shares under the shareholders' agreement of 2006. GVK's offer to Bidvest was valued at Rs 1,248 crore. GVK has been claiming that it has deposited the money in an escrow account in London.
The SC had on January 13 asked the arbitral tribunal to pronounce by January 27 its order that was to decide if GVK is in a position to purchase 13.5% stake of Bid Services. The direction to pronounce the order was given as the deadline to sell the stake to the Adani group is expiring on January 31.
Senior Abhishek Manu Singhvi, appearing for GVK, submitted that given that there is a order against Bidvest now, it should argue the merits of the case actually before the arbitral tribunal and not the apex court.
Senior counsel Dushyant Dave, also appearing for GVK Group, alleged that Bidvest Group has not received the Government of India’s permission to sell its stake to Adani yet. However, senior counsel Mukul Rohatgi, appearing for Bid Services, opposed it, saying that the Bidvest Group had the requisite permission to sell.
"Bidvest wants to sell its stake and GVK is not giving it the money… It is grossest case of a dishonest party who wants to buy and not pay," he said. Rohatgi reiterated that if Adani group backtracked now, having already waited for more than a year, then the Bidvest Group will not have any buyer. He also argued that GVK is trying to delay the process as it does not have money. "Pay me the money and buy my stake. I will walk away," he said, adding that the group will move the HC on Wednesday.
GVK had initiated arbitration proceedings to restrain Bid Services from transferring its shares. The tribunal on September 15 had restrained Bid Services from disposing or transferring its shares in MIAL until the next date of hearing.