Through a loan provided by a 13-member international banking syndicate, Grupo Aeroportuario de la Ciudad de Mexico (GACM) has secured $3 billion for the construction of Mexico City International Airport (NAICM).
The funds were secured through a revolving credit facility that will be used to make periodic investments needed for airport construction. Subject to market conditions, issuance of long-term debt bonds in the capital markets will work to prepay and renew the revolving credit facilities.
HSBC acted as administrative agent, while Citigroup and new entrant JP Morgan acted as global arrangers. The transaction included a syndicated process that saw BBVA Bancomer and Banco Santander participating as senior mandated lead arrangers; Banco Inbursa, Bank of Tokyo-Mitsubishi , Credit Agricole and Scotiabank as arrangers; and Banco Sadabell, ING, Mizuho , and Sumimoto Mitsui as lead managers.
The credit facility combines a $1 billion loan from 2014 with a new $2 billion loan, and together soaks up half the capacity of the $6 billion airport borrowing programme. All $6 billion is expected to be generated through bond issuances.
At a total estimated investment of $13 billion into airport development is expected between now and its ambitious October 20, 2020 first takeoff target, NAICM is the largest public works undertaking of Mexican President Pena Nieto's administration. Originally, the government planned to finance the remaining $7 billion of development costs, but in August, a finance ministry representative said that the oil price slump and other economic detractors could cause the government to lower its contribution to $4 billion and raise the amount to be financed by 10-, 20- and 30-year bond issuances up to $9 billion.
While mega airports the size of NAICM – which plans to accommodate 50 million annual travelers – can generally take between six and eight years to develop, and while the airport's master plan is currently four months overdue, Patino reports confidence at this point that timelines will be met, though he remains realistic about the possibility of delays.
A first bond issuance of $1 billion as part of the revolving credit facility could be utilised before the end of the year if needed, though it is not expected to be drawn upon until the second half of 2016, according to reports.