$300m securitized amortizing bond, 2010
Future flow receivable securitizations have been useful - in
some cases crucial - for Latin companies to overcome tricky
operating environments to raise cash for the past quarter
century. Aeropuertos Argentina is awarded the best structured
finance deal for not just showing the funding format is still
relevant, but for advancing it through innovation, giving
investors comfort in a difficult jurisdiction. It was also
smoothly executed under challenging conditions as one of the
few corporate issuers out of Argentina since the government's
When investors looked at the national airport operator, they
were cautious not just about the macroeconomic backdrop in the
country but also the government's history of industry
intervention. So in 2010 when AA2000 needed to fund airport
upgrades around the country, securitizing receivables was one
way forward. However, putting the B2/B rated secured amortizing
note together was complex. The bond is backed by a split of
revenues: close to half of the airport operator's passenger use
fees, dollar receivables collected offshore through the IATA
system, as well as the bulk of its duty free revenues.
The borrower must also keep 125% of the two next principal
and interest payments in dollars in an offshore account.
The careful structuring paid off. Despite a December sale,
leads Banco Macro, Credit Suisse and Morgan Stanley raised
nearly $2 billion of orders for AA2000's first cross-border
bond, and squeezed the yield down by 25 basis points to 10.75%.
The bond has continued to perform.
"During the first year, the market value frequently exceeded
its nominal value, winning investor recognition," says
Raúl Francos, CFO of AA2000. LF