Aerostar Airport Holdings Finances Lease to Operate San Juan Airport

March 28, 2013

Cleary Gottlieb represented Aerostar Airport Holdings, the private operator of the Luis Muñoz Marín (LMM) International Airport in San Juan, Puerto Rico in its issuance of $350 million of 5.75% senior secured notes due 2035, and a $60 million credit facility consisting of a $50 million capital expenditure facility and a $10 million revolving line of credit. The proceeds of the notes, which were issued in a private placement in reliance on Section 4(a)(2) of the Securities Act, were used to refinance the up-front fee previously paid by Aerostar to the Puerto Rico Ports Authority (PRPA) in connection with the long-term lease of the airport. The credit facility proceeds will be used to finance working capital and a capital investment program at the airport, which will be one of Puerto Rico’s largest construction projects and will transform LMM International Airport into a world-class airport hub.

Aerostar is a joint venture of Cleary Gottlieb clients Highstar Capital and Grupo Aeroportuario del Sureste (ASUR). In February, Aerostar entered into a 40-year lease with the PRPA to operate LMM International Airport as a public-private partnership, making it the first major airport in the United States run by a private operator under the FAA’s Pilot Privatization Program. Cleary Gottlieb represented Aerostar in connection with the negotiation and closing of the lease agreement and related airline use agreements.