L&T, Siemens may float JV for airport projects
L&T and the Indian arm of Germany’s Siemens AG are planning to join hands to bid for airport modernisation projects, reports Indulal PM.business Updated: Aug 26, 2007 23:49 IST
Diversified engineering and construction major Larsen & Toubro (L&T) and the Indian arm of Germany’s Siemens AG is planning to join hands to bid for airport modernisation projects. Both companies are now discussing the possibility of floating a joint venture similar to the one formed by the Tatas and Singapore-based Changi Airport, L&T sources said.
The deal will formalise L&T and Siemens’ alliance that started with the development of Bangalore International Airport. L&T and Siemens hold 17 and 40 per cent each, respectively, in the company that is piloting the development of the greenfield international airport in Bangalore. Flying high
Projects won by L&T
• Bangalore (Rs 890 crore)
• Hyderabad (Rs 1,110 crore)
• New Delhi (Rs 5,400 crore)
• Mumbai (Over Rs 5,000 crore) (Expected soon)
Projects won by Siemens
• Bangalore Airport
• Indianapollis airport ($22.8 million) (baggage system contract)
• Guatemala Airport (baggage handling system
The alliance is expected to be a win-win deal for both the companies. L&T is keen on a strong partner since it has bagged engineering procurement contracts for some key airport projects in the country, including New Delhi, Hyderabad and Bangalore.
“We have recently received a Rs 5,400-crore contract from the Delhi International Airport Ltd. We are expecting a similar order for the Mumbai airport as well,” L&T Chairman AM Naik said. The company is planning to bid for airport projects outside India as well.
L&T’s competitor and Hyderabad-based GMR has recently won a $2.7-billion contract to modernise the Istanbul airport. “It will be easier for L&T to bid for future projects if there is a strong partner,” company sources said.
According to sources in the aviation industry, Siemens is gung-ho about the fast-growing opportunities in airport projects in India. In addition to the modernisation of Delhi and Mumbai airports, the government wants to create alternate hubs in Chennai and Kolkata as well.
There are also plans to modernise 35 non-metro airports. The bidding process to set up the proposed Rs 4,235-crore Navi Mumbai airport project is also expected to take off shortly.