Aboitiz's Philippines airport acquisition – details revealed

Filipino conglomerate Aboitiz Group is targeting close on the P25 billion ($447m) deal to take over the Mactan-Cebu International Airport within the next 2-3 months.

GMR Megawide Cebu Airport (GMCAC) is the operator of the Mactan-Cebu International Airport, which is in Lapu-Lapu city on Mactan, a part of Metro Cebu, and serves the Central Visayas region.

“The sellers’ shareholders have approved the deal. They are getting creditor consent and refinancing because the asset will be with the new owner, where the banks will have to agree to the new terms. We expect the deal to close in the next 2-3 months," a project insider told IJGlobal

The refinancing involves the existing lenders who in 2015 signed the P23.3 billion debt package with a 15-year tenor prior to financial close, IJGlobal understands. The lenders include:

  • BDO Unibank 
  • Bank of the Philippine Islands
  • Development Bank of the Philippines
  • Land Bank of the Philippines
  • Metropolitan Bank
  • Philippine National Bank 

Aboitiz’s subsidiary Aboitiz InfraCapital in September (2022) signed a share subscription and transfer agreement worth P25 billion with the sellers. The multi-pronged transaction includes:

  • P9.5 billion – Aboitiz’s acquisition of 1/3 GMCAC equity, sellers each retain the remaining 1/3
  • P15.5 billion – sellers issue exchangeable notes to Aboitiz maturing on 30 October 2024 

GMCAC's shareholders comprise: 

  • Megawide Construction (Philippines) – 60%
  • GMR Infrastructure (India) – 40%

Once the notes mature, Aboitiz can exchange them for the remaining 2/3 equity interest in GMCAC. Meanwhile, GMR will continue to provide technical service support to GMCAC. 

Advisers include:

  • Aboitiz:
    • AlphaPrimus Advisors – Aboitiz’s financial
    • Gulapa Law – Aboitiz’s legal
  • sellers:
    • BDO Capital & Investment Corp – financial
    • Romulo Mabanta Buenaventura Sayoc & de los Angeles – legal
    • Shardul Amarchand Mangaldas & Co – legal

Mactan-Cebu was among the country’s first PPPs with a large-size ticket to obtain limited-recourse financing. Megawide-GMR consortium in April 2014 won the concession by offering the highest upfront fee at P14.4 billion. The total project cost was P33 billion with a debt/equity ratio of 70/30.

The project was a BOT model with a 25-year concession period involving a new terminal building on the existing airport, which commenced operations in 2018. Aboitiz stated that the airport had seen more than 2 million passengers in H1 2022, a 350% increase from the previous year.

Aboitiz did not respond to IJGlobal’s request for comment at the time of publication.

Asset SnapshotMactan-Cebu International Airport

Value:
N/A
Full Details

Transaction SnapshotAcquisition of 33% in Mactan-Cebu International Airport PPP

Financial Close:
16/12/2022
Value:
$170.46m USD
Concession Period:
25.00 years
PPP:
Yes
Full Details