Fundraising

Macquarie increases Sydney Airport stake(2)

MAp has completed a refinancing of the airport, resulting in a increase of its holding to 74%. The group contributed A$711m of cash to reduce the asset’s debt, in addition to a further A$159m put forward by the other remaining shareholders.

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Macquarie Airports (Map) has increased its stake in Sydney Airport to 74 percent after completing a deleveraging of the asset.

Map revealed to the Australian Securities Exchange that it had contributed A$711 million (€407 million; $568 million) in order to eliminate term debt maturing in the second half of this year. As a result of the cash payment, MAp has acquired an additional 1 percent interest in the asset, increasing its stake in the airport to 74 percent. Including MAp’s contribution, Sydney Airport’s shareholders invested a combined A$870 million as part of the debt reduction.

The overhaul of Sydney Airport’s capital structure is one of a number of initiatives under way amongst funds managed by Macquarie Group that are intended to yield increased capital returns. This week Macquarie Infrastructure Group said its future distributions to shareholders will more closely resemble the firm’s cashflows.

Following the transaction, Sydney Airport has net senior debt of A$4.6 billion, at a debt/EBITDA ratio of 7x. Its next material debt commitments fall due in September 2011.

MAp said its cash balance following the deleveraging is A$766 million. However, the group expects to increase this through the sale of its 19.9 percent interest in Japanese airport operator Japan Airport Terminal, the tendering process for which was announced last month.

Earlier this month Map revealed that traffic across all of its airports had fallen during the month of May, with Sydney Airport experiencing a 4.4 percent drop from the prior corresponding period.