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Aboitiz InfraCapital Inc. is acquiring a 33.33% stake in Mactan-Cebu International Airport (MCIA) operator GMR-Megawide Cebu Airport Corp. (GMCAC) for P9.5 billion
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Megawide Construction Corp. and GMR Airports International BV executed on September 2 a share subscription and transfer agreement with AIC that seals AIC’s stake acquisition in GMCAC
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The agreement results in AIC owning a 33.33% minus 1 share stake in GMCAC
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The deal also calls for Megawide and GAIBV to issue P15.5 billion of exchangeable notes maturing on October 30, 2024 to AIC, which it will swap for the remaining 66.66% +1 share held by GMCAC
Aboitiz Group subsidiary Aboitiz InfraCapital Inc. (AIC) is buying a 33.33% stake in Mactan-Cebu International Airport (MCIA) operator GMR-Megawide Cebu Airport Corp. (GMCAC) for P9.5 billion.
Megawide Construction Corp. and GMR Airports International BV (GAIBV) on September 2 executed a share subscription and transfer agreement with AIC to acquire shares in GMCAC, Megawide said in a stock exchange disclosure.
AIC is the infrastructure arm of the Aboitiz Group that has been participating in various public-private partnership bids across the country, including in the airports sector, water sector, and industrial estates.
Megawide and GAIBV, joint partners in the 25-year concession agreement to develop, operate, and maintain MCIA, have agreed to sell down their existing stakes in GMCAC to accommodate AIC’s entry.
The agreement involves GMCAC issuing primary shares and transferring secondary shares amounting to P9.5 billion from Megawide and GAIBV to AIC, which will result in AIC owning a 33.33% minus 1 share stake in GMCAC.
The transaction also involves Megawide and GAIBV issuing P15.5 billion worth of exchangeable notes that will mature on October 30, 2024, which will be exchanged by AIC for the remaining 66.66% plus 1 share of GMCAC’s outstanding capital stock.
“The transaction was accepted and deemed fair by all parties and aligned with their respective long-term goals,” BDO Capital & Investment Corp. president Eduardo V. Francisco said.
“For GMCAC, the infusion provides it more financial muscle, with a higher capitalization, bigger balance sheet, and an improved gearing ratio. It also paves the way for the entry of another experienced and strong industry player,” Francisco added.
“We have always been open to partnerships that will enhance our capabilities and diversify our portfolio as an infrastructure innovator. The company’s thrust of being an infrastructure innovator remains on track with this deal, as we harness synergies with other major participants in the field,” Megawide chairman, chief executive and president Edgar B. Saavedra said.
Megawide has revealed that over the past years, it has been receiving feelers from several parties to join its mission to modernize airport infrastructure in the Philippines, with MCIA as the prototype.
Louie Ferrer, GMCAC president and Megawide executive director for infrastructure development, said that “AIC has deep roots in Cebu and MCIA deserves another world-class, Cebuano company to sustain what GMCAC has built so far, and take it to the next level.”
Megawide said this move is also in line with its strategy of constantly re-engineering its business and financial portfolio to support its vision of engineering a first-world Philippines.
“From Megawide’s perspective, the agreement enables us to crystallize the asset’s fair market value and helps unlock resources that will accelerate our developmental infrastructure portfolio and allows us to strengthen our balance sheet, as part of our long-term financial management program,” Saavedra said.
The transaction is subject to customary closing conditions, including requisite third-party and regulatory approvals.
BDO Capital & Investment Corp. acted as the financial adviser, and Romulo Mabanta Buenaventura Sayoc & de los Angeles and Shardul Amarchand Mangaldas & Co as legal counsel, of Megawide and GAIBV while AlphaPrimus Advisors acted as financial adviser and Gulapa Law as legal counsel of AIC in this transaction.
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