DOMINICAN REPUBLIC. Advent International, the global private equity firm that is a leading shareholder in Dominican Republic’s leading airport retailer Dufry, has acquired 100% of Aeropuertos Dominicanos Siglo XXI SA (Aerodom), the Dominican Republic’s major airport group and one of the largest airport operators in Central America and the Caribbean. It has bought the company from the Hazoury Group, Vancouver Airport Services and other local investors. The value of the transaction was not disclosed.
The acquisition, funded with equity from Advent and debt financing from the Bank of Nova Scotia and ING Group, is the first leveraged buyout in the Dominican Republic. It also marks Advent’s 13th deal in the airport sector.
Advent has established a new company, Latin American Airport Holdings, to hold its interest in Aerodom, as well as other of its existing airport businesses. The combined group has an enterprise value in excess of US$1 billion and will serve as a platform for acquiring additional airport concessions in Latin America.
Aerodom has a 30-year concession contract with the Dominican Government and the Airport Commission to develop, operate and manage six airports in the Dominican Republic. These include Las Américas in Santo Domingo, which serves as the country’s principal international gateway and is the second-largest airport in terms of passengers; Gregorio Luperón in Puerto Plata; Samaná and Arroyo Barril, both near Samaná; La Isabela in Santo Domingo; and Maria Montéz in Barahona.
More than four million passengers, or about half of all airport passengers in the Dominican Republic, used the Aerodom airports in 2007. Unlike most Latin American airports, which are heavily dependent on tourist traffic, Aerodom has a diversified passenger base, split between tourist, ethnic, business and domestic passengers.
“Aerodom is a market leader in one of the busiest Caribbean destinations by number and growth of tourist, ethnic and business arrivals,” said Luis Solórzano, a Director in Advent International’s Mexico City office. “This investment allows us to leverage our expertise in the airport sector to enhance the value of the business. For example, we see significant potential to increase the percentage of revenue generated from commercial sources, such as duty free retail, food & beverage, and optimisation of terminal space, as we have done with several of our other airport investments.”
Solórzano continued: “With the creation of Latin American Airport Holdings, we are developing a strong platform for growth in airport assets across the region, serving over 20 million passengers, and the enlarged group will have better access to capital markets to fund further expansion. Additionally, the holding company structure will allow us to achieve certain synergies through sharing of best practices and centralisation of administrative costs.”
Aerodom’s existing management and Vancouver Airport Services, its current operating partner, will continue to run the company, and Advent will augment the team with a number of senior executives who have managed other Advent portfolio companies in the airport sector.
“Advent International has a long history of investing in Latin America, particularly in the airport sector, and we look forward to working closely with them as we embark on our next phase of growth,” said Ken Hassard, Commercial Director of Aerodom. “In addition to increasing commercial revenue, we will pursue a number of value-creation initiatives such as improving car parking facilities, expanding infrastructure for private aviation, improving fuel services and expanding cargo operations.”
About Advent International in Latin America
Advent International is one of the most established and successful private equity investors in Latin America. Since it began operating in the region 12 years ago, the firm has invested in 37 companies with a combined enterprise value exceeding US$8 billion. Advent also has a strong history of realisations, having exited 20 investments, primarily through trade sales and IPOs. Its current LAPEF IV fund, capitalized at US$1.3 billion, is the largest private equity fund ever raised for Latin America.
About Advent International
Founded in 1984, Advent International is one of the world’s leading global buyout firms, with offices in 15 countries on four continents. A driving force in international private equity for more than two decades, Advent has built a global platform of over 120 investment professionals across Western and Central Europe, North America, Latin America and Asia. The firm focuses on international buyouts, strategic restructuring opportunities and growth buyouts in five core sectors, working actively with management teams to drive revenue and profit growth in portfolio companies. Since inception, Advent has raised US$24 billion in private equity capital and completed more than 250 buyout and private equity transactions valued at over US$40 billion in 40 countries.
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