Airport Financing of the Year: Salvador Bahia Airport
SPONSOR: Vinci Airports SAS
LOCATION: Salvador, Bahia, Brazil
FINANCING TYPE & SIZE: $138 million project financing
BANKS: Banco do Nordeste, Banco Bradesco, Itaú Unibanco, Banco ABC Brasil, Banco ABN Amro, BNP Paribas, Intesa Sanpaolo Brasil, Banco Múltiplo, SMBC
LAW FIRMS: Mattos Filho, Vieira Rezende Advogados
Due to its successful execution, its true non- recourse status and important social impact, Vinci Airports’ Salvador Bahia airport expansion and ren- ovation picks up LatinFinance’s prize for Airport Financing of the Year.
To fund the airport’s upgrade, Vinci secured a 20-year BRL517 million true non-recourse loan from Banco do Nordeste do Brasil (BNB), backed by a guar- antee from seven banks, a record for airport financ- ings in Brazil, according to Mattos Filho, Veiga Filho, Marrey Jr. e Quiroga Advogados, which provided counsel to the borrower. The deal was BNB’s first ever financing for an airport.
The syndication process for the loan’s surety letters was rapidly executed, thanks to its use of advanced versions of financing documents to pick the banks. The approach enabled an optimized and efficient execution of the deal, according to the law firm.
Salvador Bahia’s financing came amid the structur- ing of a true non-recourse loan, where the company’s equity obligations are limited only to base-equity contributions. The French-based Vinci is not liable for any delays or cost overruns, atypical for a Brazil- ian market where surety providers don’t typically assume such risk.
It was the first non-recourse structure imple- mented in a Brazilian airport financing. BNP Paribas was the financial advisor to Vinci.
Awarded a 30-year concession by Brazil’s National Civil Aviation Agency in 2017, Vinci began operating the airport in January 2018.
The airport was the busiest in northeast Brazil last year, with 9 million passengers passing through. The upgrade includes the construction of a new 20,000 square meter departure area and refurbishment of the existing terminal, construction of a new pier with six boarding bridges, modernization of the HVAC and wastewater systems, and refurbishing of runways. Investments in sustainability include the construc- tion of a solar plant meant to supply energy equiva- lent to that needed by 58,000 households.