Feb 10 2011
Aecon Group Inc. (TSX: ARE) announced today that the previously disclosed restructuring of the Quito International Airport project has been finalized, and project funding has resumed.
Quito International Airport
The restructuring, which has received approval from the Constitutional Court of Ecuador, addresses a prior Court ruling which raised a number of issues important to Aecon and its partners, the project lenders, and the Municipality of Quito.
With the restructuring finalized, construction activity will now ramp-up on the site, with completion of the new airport now scheduled for October 2012. Construction is approximately 72% complete.
Key elements of the restructuring include:
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Corporacion Quiport S.A ("Quiport"), which holds concession rights to both the existing Quito Airport and the new airport currently under construction, will pay the municipality of Quito 11% of the new airport's "Regulated" revenues (rising to 12% in the final five years of the concession). Regulated revenues include such things as airline landing fees and passenger departure fees.
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A schedule of fee increases was established for all Regulated fees. The schedule, which follows the maximums established in the original concession agreements, provides Quiport with increased certainty regarding the revenues expected to be derived from the concession, and does not limit Quiport's ability to charge market fees for "Non-regulated" items such as duty free and car rental concessions, parking, food services etc.
"The closing of this new commercial agreement is a major step forward for the Quito Airport Project," said Steve Nackan, President of Aecon Concessions. "It provides the Ecuadorian authorities and the Municipality of Quito with the assurances they require, and it provides Aecon, our partners and lenders with increased certainty regarding the revenues to be expected from the project."
The restructuring was negotiated among the various parties involved in the Quito International Airport Project, including the Municipality of Quito, the Ecuadorian authorities, the Canadian Commercial Corporation ("CCC", an agency of the Government of Canada that holds the contract to construct the new Quito Airport), and the project lenders, as well as Aecon and its partners in Quiport.
A number of approvals and conditions precedent were required before the restructuring could be finalized, all of which are now in place.
Aecon has a 42.3% economic interest in the Quito airport concession through its stake in Quiport. The project's senior lenders are: Overseas Private Investment Corporation of the USA, Export-Import Bank of the USA, the Inter-American Development Bank and Export Development Canada (EDC).
Source: http://www.aecon.com/