Chadbourne represented J.P. Morgan as sole initial purchaser in connection with a $550 million senior secured bond offering for Aeropuertos Dominicanos Siglo XXI, S.A., the principal airport concessionaire in the Dominican Republic. The bonds are guaranteed by Latin American Airports Holdings Ltd., a Bermuda company whose other principal subsidiary is Imobiliaria Fumisa, S.A. de C.V., a Mexican company that owns the master lease at the Mexico City airport’s Terminal 1, as well as certain of its subsidiaries. Latin American Airports Holdings Ltd. is 86% owned by funds managed by affiliates of Advent International, one of the world’s leading private equity firms.
The deal closed on November 13.
The bonds are initially secured by pledges of shares of the issuer as well as intermediate holding companies and there is a step-up in the interest rate on the bonds if certain additional collateral is not granted by the issuer within a certain period. The bonds were sold in the United States using the Rule 144A exemption from registration and outside the United States under Regulation S.
The issuer used the proceeds to refinance existing indebtedness and to pay a dividend to the shareholders. “The offering was challenging to execute within the agreed timetable, but all parties worked diligently to achieve the goal of pricing and closing before the financial statements became stale, a perennial problem this time of year for capital markets transactions”, commented Marc Rossell, the partner who led the Chadbourne team representing J.P. Morgan. “There has been a recent revival of so-called leveraged ‘dividend recapitalization’ deals in the high-yield market, and the fact that a significant portion of the offering proceeds were used to make a dividend payment was an issue that investors had to get comfortable with.”
This offering follows the Firm’s successful representation of Aeropuertos Argentina S.A. in that company’s senior secured note offering that won the Structured Finance “Deal of the Year” award from Latin Finance, thus continuing to showcase Chadbourne’s strength and experience in capital markets transactions in the infrastructure space.
Working on the Chadbourne team were Marc Rossell, Gabriella Sakamoto, Coleman Miller and Jorge Dominguez, as well as Ted Markson on the tax side.
