Business Context and Reporting Period
This Form 6-K filing by Southeast Airport Group (ASUR) covers the period of September 2012. ASUR is a Mexican airport operator managing nine airports in southeast Mexico, including Cancún. The filing details significant developments regarding ASUR's joint venture, Aerostar Airport Holdings, which is pursuing a 40-year lease for the Luis Muñoz Marín (LMM) Airport in San Juan, Puerto Rico.
Key Financial Metrics and Capital Structure
The filing does not provide consolidated revenue, profit, cash flow, or margin data for ASUR. Financial details are specific to the Aerostar joint venture transaction:
- Upfront Leasehold Fee: $615 million (subject to adjustments).
- Third-Party Debt Financing: Commitments received for up to $350 million (term loan for leasehold fee), $50 million (capital expenditures), and a $10 million revolving credit facility.
- ASUR Loan Commitment: ASUR committed to lend Aerostar up to $100 million to fund the leasehold fee. This loan is subordinated to senior debt, bears interest at LIBOR plus 2.00%, and is repayable from cash available for distribution prior to equity distributions.
- Equity Contributions: ASUR and Highstar Capital IV committed to contribute 50% of the upfront fee and closing costs, net of 50% of debt incurred.
Material Changes and Developments
Key updates regarding the LMM Airport lease include:
- Regulatory Status: The Puerto Rico Ports Authority (PRPA) submitted an application to the FAA for approval under the Airport Privatization Pilot Program. The FAA will open a 60-day public comment period before making a determination.
- Operating Certificate: Aerostar has initiated discussions with the FAA regarding its application for a Part 139 operating certificate, a condition precedent to closing.
- Management Transition: Aerostar named its transition team, led by CEO Agustin Arellano (currently ASUR's Director of Infrastructure and Regulation), to facilitate operations prior to closing.
Outlook, Risks, and Contingencies
Conditions Precedent: The closing of the LMM lease remains contingent upon FAA approval of the lease application and the award of a Part 139 operating certificate to Aerostar.
Accounting Treatment: ASUR is currently evaluating the accounting treatment for its debt and equity investments in Aerostar.
Investor Benefits: Highstar Capital IV granted ASUR a benefit agreement: if Highstar sells its interest while ASUR retains at least 25% of Aerostar, ASUR is entitled to 20% of Highstar's realized return in excess of 14% per annum.
Risk Factors: The filing includes standard forward-looking statement disclaimers, noting that actual developments could differ significantly from expectations due to regulatory approvals and other factors.
Key Facts for Investor Verification
- Confirmation of the FAA's timeline for the 60-day public comment period and subsequent decision on the lease application.
- Status of Aerostar's application for the Part 139 operating certificate.
- Finalization of the $350 million term loan and other financing commitments from the syndicate of banks.
- ASUR's final determination on the accounting treatment of the Aerostar investment.
- Any adjustments to the $615 million upfront leasehold fee prior to closing.