NEW YORK (Reuters) - Parking Co of America Airports LLC, the largest operator of off-site U.S. airport parking lots, filed for Chapter 11 bankruptcy after declines in business and leisure travel caused revenue to fall.
The company’s owner, Macquarie Infrastructure Co (MIC.N), said it plans to sell the parking business to Bainbridge ZKS-Corinthian Holdings LLC for about $111.5 million, pending bankruptcy court approval.
It said the sale would eliminate $201 million of debt and is expected to close in the first half of 2010.
Based in Essington, Pennsylvania, Parking Co of America said it operates 31 off-site airport lots comprising more than 40,000 parking spaces under the AviStar, FastTrack and SkyPark names.
The company said it operates near seven of the 10 busiest U.S. airports. Among the airports it serves are Hartsfield-Jackson in Atlanta, O’Hare in Chicago, airports in Denver and San Francisco and the three major New York-area airports.
Macquarie Infrastructure invests in roads, tollways and other public facilities, and is overseen by Australia’s Macquarie Group Ltd (MQG.AX). The company did not immediately return a call seeking further comment.
PCAA and 13 affiliates filed for protection from creditors with the U.S. bankruptcy court in Wilmington, Delaware.
It said it had $94 million of assets and $233 million of liabilities as of September 30, and employs about 1,063 people.
In an affidavit, PCAA Chief Executive Charles Huntzinger said the company was hurt by a “sharp” decline in revenue stemming from high fuel prices and the economic recession.
“PCAA has struggled to maintain liquidity in light of its debt levels,” he said.
The company plans to sell its parking business under a court-supervised bidding and auction process.
It plans to obtain $5 million of financing from lenders including Dekabank Deutsche Girozentrale and ING Real Estate Finance (USA) LLC to keep operating while in bankruptcy, court records show.
In a related matter, Macquarie Infrastructure expects a $40 million to $60 million fourth quarter 2009 charge to boost its valuation for deferred tax assets. It said it previously wrote down its equity in the airport parking business to zero.
The case is In re PCAA Parent LLC, U.S. Bankruptcy Court, District of Delaware, No. 10-10250.
Reporting by Jonathan Stempel; Additional reporting by Joseph A. Giannone; Editing by Gerald E. McCormick