Aeropuertos Argentina launches exchange for $400 million 6 7/8% notes

By Sarah Lizee

Olympia, Wash., April 21 – Corporacion America Airports SA subsidiary Aeropuertos Argentina 2000 SA launched an offer to exchange any and all of its $400 million 6 7/8% senior secured notes due 2027 for newly issued 6 7/8% cash/9 3/8% PIK class I series 2020 additional senior secured notes due 2027, according to a press release.

The terms of the series 2020 additional notes will be substantially identical to the terms of the existing notes, except that the quarterly interest payment originally scheduled to be paid in cash on the existing notes on May 1 will be paid in cash in the form of the interest premium payment and/or in kind by increasing the principal amount of any series 2020 additional notes issued on the settlement date for eligible holders who validly tender at or prior to the expiration deadline.

Quarterly interest payments originally scheduled to be paid in cash on the existing notes on Aug. 1, Nov. 1 and Feb. 1, 2021 will be paid in kind by increasing the principal amount of any outstanding series 2020 additional notes at a rate of 9 3/8% per annum, quarterly amortization payments originally scheduled to be paid on the existing notes on May 1, Aug. 1, Nov. 1 and Feb. 1 will be deferred to begin on May 1, 2021 and continue under a new principal amortization schedule until maturity.

At any time after Feb. 1, 2021, the company will have the right to exercise a one-time optional redemption to redeem, in whole or in part, an amount of series 2020 additional notes equal to the sum of the aggregate amount of interest payments previously paid in kind on the series 2020 additional notes and the aggregate amount of quarterly amortization payments originally scheduled to be paid on the existing notes on May 1, Aug. 1, Nov. 1 and Feb. 1, that is effectively deferred under the exchange.

Substantially all of the restrictive covenants and events of default and related provisions under the indenture will be eliminated with respect to the existing notes. The series 2020 additional notes and the existing notes will be secured by the same collateral on a pro rata and pari passu basis in line with the indenture and the related collateral documents.

The company is also soliciting consents from holders of the existing notes to some proposed amendments to the indenture.

The proposed amendments would provide for the issuance of the series 2020 additional notes and would eliminate substantially all of the restrictive covenants and events of default and related provisions with respect to the existing notes.

Holders who tender their existing notes in the exchange offer will be deemed to give their consent to the proposed amendments under the consent bid.

Holders who validly tender existing notes and deliver consents under the consent solicitation on or prior to 5 p.m. ET on May 1 and whose existing notes are accepted for exchange will receive a principal amount of series 2020 additional notes equal to 90% of the outstanding principal amount of their existing notes plus accrued interest to but excluding the settlement date, which is expected to be May 20.

Accrued interest for existing notes tendered on or prior to the early participation date will include an interest premium payment equal to 1% of outstanding principal amount of their existing notes, payable in cash. The interest premium payment is a portion of accrued interest on the existing notes.

The balance of any accrued interest not paid to exchanging holders as the interest premium payment will be paid in additional principal amount of series 2020 additional notes on the settlement date.

Eligible holders who validly tender existing notes and deliver consents after the early participation deadline and before 11:59 p.m. ET on May 18, the expiration deadline, and whose existing notes are accepted for exchange will receive a principal amount of series 2020 additional notes equal to 90% of the outstanding principal amount of their existing notes, plus accrued interest paid entirely in additional principal amount of series 2020 additional notes.

It is a condition to the exchange offer, among others, that at least 80% of the outstanding principal amount of the existing notes is validly tendered for exchange and not withdrawn.

The company said the exchange offer and the consent solicitation are part of its plan to mitigate the impact of the Covid-19 pandemic that has heavily impacted the global aviation sector which lead to a drastic reduction in passenger traffic.

The company said it is seeking to extend some of its short-term debt payments with the intention to preserve cash by delaying some payments until passenger traffic and revenue generation recover.

Global Bondholder Services Corp. (866 470-4200 toll-free, 212 430-3774 collect for banks and brokers) is the information agent and exchange agent for the exchange offers.

The airport operator is based in Luxembourg.

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