Panama’s Tocumen Airport plans new $650 million bond issue

Panama’s Tocumen Airport administrators in Panama are negotiating with Citi to structure and launch the second bond issue in two months in order to complete financing for the expansion of the airport’s South Terminal, reports

The goal is to sell the entire issue on the international market before the end of this year, and simultaneously negotiate with the holders of bonds of the first issue to extend their maturity periods, improving debt conditions so that the final funding of the South Terminal will be complete.

After two years of construction, the final cost of the work has increased from $679 million to around $800 million, after the government requested modifications to the original design on the grounds that the building was not functional for today’s airport needs.
Panama’s government had planned to raise funds from the duty free concessions in the new terminal, but now says that the new bond will be necessary.

Joseph Fidanque III, manager of Tocumen, told that “… The financial plan that the previous administration left is not feasible, because it was based on the tender of commercial or duty free areas in the South Terminal, to pay for the work, but it has been reported that these spaces will not be ready before 2017 … ‘There are very few, or perhaps no entitles who will invest in something that they cannot use for three years’.”