The Rise and Fall of GVK : In every era, certain corporate names become synonymous with the government of that time. Today, the Adani Group finds itself in that position. But a decade ago, the same space was dominated by companies like GMR and GVK. The way Adani Group is rapidly expanding today, GVK was growing at the same speed during its peak years. It was ambitious, bold and aggressive in its approach, and for a while, it seemed unstoppable.
GVK created India’s first independent power plant, developed the first six-lane road project, and even secured the prestigious contract to build the Navi Mumbai Airport.
In 2011, the group went global by purchasing a coal mine in Queensland for $1.26 billion. Along with this, it announced plans for a 500-km railway line and a port. These were massive steps that signaled the company’s intention to become a global infrastructure force.
But as history often shows, rapid expansion can sometimes plant the seeds of future trouble.
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A Report That Sparked a Crisis: The Rise and Fall of GVK
Just as the Adani Group faced turbulence after the Hindenburg report, GVK encountered a similar setback in 2012. Credit Suisse released a report titled “House of Debt”, which listed the top ten Indian corporate houses burdened by excessive loans. GVK’s name was on that list.
This report damaged the group’s reputation. Investors began to hesitate, lenders grew cautious, and the company started facing difficulties in securing funds. The timing could not have been worse, because GVK was already juggling large-scale projects that required heavy capital.
Delays, Disasters and a Changing Political Climate
One of GVK’s major projects was a 330 MW hydropower plant on the Alaknanda River in Uttarakhand. Just before it could start operations, the state was hit by a massive flood. The project was pushed back by almost two years. What began as a natural disaster soon turned into a financial burden as costs escalated and timelines kept extending.
This delay stretched from 2012 to 2014, and by the time the project moved forward, the political landscape of the country had changed. With the arrival of a new government, policies and priorities shifted.
The same year, the Supreme Court cancelled several coal block allocations across India. GVK’s 540 MW Goindwal Sahib thermal power project in Punjab suffered directly because coal supply suddenly became uncertain. A project ready for operation found itself gasping for fuel.
From every direction, challenges were piling up. Losses were increasing, debts were growing, and projects were getting stuck.
The Beginning of GVK’s Downfall
GVK was already walking a tightrope when another major conflict began, this time with the Adani Group. What started as competitive friction slowly turned costly for GVK.
The first major blow came from the Navi Mumbai Airport project. Yes Bank, which had initially agreed to fund GVK’s share, suddenly backed out. Soon after, SBI also delayed the financial closure. Maharashtra’s CIDCO started raising questions about alleged breaches in the shareholders’ agreement.
These delays drained GVK’s resources further. But the biggest storm was yet to come.
A Mysterious Letter, Investigations and Mounting Pressure
Out of nowhere, the CBI received an anonymous letter claiming that GVK Chairman G.V.K. Reddy and his son G.V. Sanjay Reddy had siphoned ₹705 crore from Mumbai Airport funds. No one knew who wrote the letter, but CBI filed an FIR based on it. The Enforcement Directorate soon followed with its own money-laundering investigation.
Raids were conducted at multiple GVK offices. The group suddenly found itself battling not just financial crises, but legal and reputation crises too.
In 2020, a Mint article questioned the timing of these actions, hinting at a strange coincidence: as soon as GVK resisted selling stakes to Adani, investigations intensified.
From business troubles to regulatory hurdles, GVK was cornered from all sides.
The Turning Point: GVK Gives In
Eventually, the inevitable happened. News broke that GVK had agreed to a deal with the Adani Group. Under the arrangement, GVK would transfer its shares in Mumbai Airport to Adani, and in return, Adani would take over GVK’s debt owed to banks like SBI.
Soon after, ACSA and Bidvest also quietly sold their remaining shares to Adani. That gave the Adani Group a commanding 74% stake in Mumbai Airport. The under-construction Navi Mumbai Airport also came under Adani’s control.
And just months after the deal was sealed, in early 2023, the CBI declared that it found no corruption in the case filed against GVK. The timing again raised eyebrows but the events had already taken their course.
Government Policies Shift and New Players Take Over: The Rise and Fall of GVK
The week after Adani took over Mumbai Airport, the Civil Aviation Minister stated that the government should not be running airports or airlines, and such sectors should be handed to private players. Shortly after, the government announced that six more airports, Ahmedabad, Guwahati, Jaipur, Lucknow, Mangalore and Thiruvananthapuram, would be privatized under the PPP model.
When bidding opened, the Adani Group won all six airports. With Mumbai already under its belt, the group now controlled seven of the eight airports that had come up for privatization.
Later, it was revealed that the rules for airport bidding had been changed beforehand. Earlier, companies without airport-related experience could not participate. But those rules were relaxed. Despite objections from the Finance Ministry and NITI Aayog, the revised norms were implemented, making it possible for new entrants like Adani to compete and win.
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