Macquarie fund refis aviation services firm

Successful refinancing allows MIC to distribute portion of cash to shareholders

Atlantic Aviation, a subsidiary of the Macquarie Infrastructure Company (MIC), has successfully refinanced a seven-year, $465 million term loan, repaying in full all outstanding debt, the New York Stock Exchange-listed company said in a statement.

“The refinancing allows Atlantic Aviation to distribute its substantial free cashflow to MIC and MIC, in turn, to distribute a portion of the cash to its shareholders as an element of its quarterly cash dividend,” MIC chief executive James Hooke said in a statement.

Atlantic Aviation’s new loan has an interest rate of 2.5 percent over LIBOR. The LIBOR component has a floor of 75 basis points, while MIC expects to use either an interest rate swap or a cap to hedge against the floating rate component for approximately six years, it explained in a statement.

The airport services provider’s gearing ratio cannot be more than 4.5 times debt to earnings before interest, tax, depreciation and amortisation (EBITDA) over the trailing 12-month period for the first two years of the loan facility – and no more than 4.25 times thereafter, according to the terms of the new loan. 

At closing, Atlantic Aviation’s leverage ratio was 3.5 times debt to EBITDA.

In addition to the new loan, Atlantic Aviation has also secured $70 million in revolving credit, which will be used to fund the company’s growth and expansion, according to MIC.

Based in New York, Macquarie Infrastructure Company owns, operates and invests in a diversified group of infrastructure businesses providing basic services to customers in the United States. It is a wholly-owned subsidiary of Sydney-based asset manager Macquarie Group.