Investors line up for AA2000 bond swap
May 5, 2020
Bondholders turn in 85% of outstanding notes for new bonds that put off payments for a year
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Aeropuertos Argentina 2000 (AA2000) said on Monday that investors agreed to swap the airport operator's 6.875% 2027 bonds for new notes that mature in 2027 and offer a higher yield in the short term.
Bondholders tendered $341 million in 2027 notes, or 85.2% of the $400 million outstanding, surpassing the threshold of 80% that AA2000 needed to carry out the debt exchange, the company said in a statement.
Investors that participated in the bond swap by the early deadline on May 1 received 101% of principal in new notes. Holders of the remaining 14.8% in 2020 notes can receive 90% of principal through the final deadline on May 18, AA2000 said.
AA2000 intends to settle the offer on May 20, it added.
According to the proposal, AA2000 will make an interest payment on the new notes at the same terms as the old notes on May 1. After that, however, it will put off payments until May 2021, but pay an annual rate of 9.375%. The company has the right to redeem the notes at any time after February 2021.
AA2000 printed the initial 2027 notes in January 2017 and used the money to redeem its 10.75% 2020 bonds that it sold in December 2010.
Last week, AA2000 also extended the due date on a $120 million loan as part of its plan to put off debt payments after travel restrictions imposed during the coronavirus pandemic led to a drastic drop in passenger traffic at the 35 airports that it operates in Argentina. The company will skip the planned payments in August and November this year and instead make quarterly installments from September 2021 to June 2022.
It got the two-part loan in August 2019 from Citi, ICBC, Galicia and Santander to fund construction works. The deal involved a local credit line for $85 million at a fixed rate of 9.75% per year and an offshore line for $35 million at 550 basis points over Libor.
Corporación América, held by billionaire Eduardo Eurnekian, owns 75.7% of AA2000, while the federal government has 15%, Italy's Gruppo SEA has 8.5% and the local construction company Riva has 0.85%.