Mexican Government’s $1.5 Billion Offering to Finance Construction of New Mexico City International Airport
March 26, 2018
Cleary Gottlieb is representing the Mexican Ministry of Communications and Transportation and its subsidiaries Grupo Aeroportuario de la Ciudad de Mexico, S.A. de C.V. (GACM) and Aeropuerto Internacional de la Ciudad de Mexico, S.A. de C.V., in a $1.5 billion offering of trust certificates (Certificados Bursátiles Fiduciarios de Inversión en Energía e Infraestructura, CBFEs) issued by a Mexican FIBRA E issuer trust to finance the construction and development of the New Mexico City International Airport (the Mexico City Airport FIBRA E).
The Mexico City Airport FIBRA E is a newly created Mexican energy and infrastructure special purpose investment vehicle holding an equity interest in GACM, in the form of special shares with preferred economic rights, linked to the results of operations of the existing Benito Juarez International Airport and, upon commencement of its operations, the New Mexico City International Airport. GACM will use the proceeds of such sale for the construction and development of the New Airport. The Mexico City Airport FIBRA E constitutes a novel structure that will allow the Issuer to receive, for distribution to the CBFE holders, an incremental percentage of cash flows from the operation of the airports until recovery of a specified target return.
The transaction consists of an initial public offering of 272,727,273 CBFEs (excluding the overallotments) on the Mexican Stock Exchange and a simultaneous private offering in the U.S. under Rule 144A of the Securities Act and outside of the U.S. in reliance on Regulation S. The transaction priced on March 23, 2018, and is expected to close on March 28, 2018. Credit Suisse participated in the transaction as global coordinator and Credit Suisse, Citigroup and BTG Pactual participated as joint bookrunners of the international offering.
Cleary previously represented the Mexican Government in the first and second stages of the financing for the construction of the New Mexico City International Airport, consisting of a $1 billion term loan that closed in 2014, and a refinancing of the loan with a $3 billion revolving credit facility that closed in 2015, which was reported as the largest syndicated revolving facility ever in Latin America. Cleary also represented the Mexican Government in the subsequent stages of the financing, consisting of a $2 billion offering of green bonds due 2026 and 2046, issued in 2016, and a $4 billion offering of green bonds due 2028 and 2047, issued in 2017.
The New Mexico City International Airport is expected to become the largest in Latin America and serve as a regional hub.