March 4 Final approvals of a deal to privatize
Puerto Rico's main airport add up to a credit positive for the
heavily indebted Caribbean island, Moody's Investors Service
said on Monday.
"The public-private partnership will provide the
cash-strapped Puerto Rico Ports Authority (unrated), the
airport's operator, with an immediate up-front lease payment of
$615 million," Moody's said.
"Of that amount, $491 million will pay down loans and loan
guarantees from the Government Development Bank for Puerto Rico
(rated 'Baa3 negative'), making the transaction credit positive
for GDB, and in turn for the Commonwealth of Puerto Rico (rated
Both federal regulators and Puerto Rico's new governor,
Alejandro Garcia Padilla, signed off last week on a 40-year
agreement with Aerostar Airport Holdings LLC to operate Luis
Munoz Marin International Airport.
The deal for the Caribbean's busiest airport, with nearly 9
million passengers a year, is a milestone in Puerto Rico's
privatization program and was valued by Puerto Rico officials at
"The privatization and transfer of risk will benefit the
commonwealth at a time when the government is struggling with a
seven-year economic downturn, lower-than-projected general
government revenues in the current fiscal year ending 30 June,
high debt levels and a severely under funded pension system,"