Megawide Construction Corp. said Friday that the lenders of its subsidiary GMR-Megawide Cebu Airport Corp. (GMCAC) have agreed to adjust the airport company’s debt servicing commitments and relax debt covenants.
The agreement covers “the end-2020 outstanding P23.9-billion project financing contracted to develop, operate, and maintain the… Mactan-Cebu International Airport (MCIA),” Megawide said in a statement to the stock exchange.
GMCAC is a consortium between Megawide and Bangalore-based GMR Infrastructure Ltd.
According to the final terms of agreement recently executed by GMCAC and its lenders, “the exercise will temporarily free up approximately P3.6 billion in cash from 2021-2023 and reinforce GMCAC’s financial position, which can be utilized to support operations while the ongoing pandemic limits air travel,” Megawide said.
“Principal payments will be postponed to 2027-2029, based on the renewed Omnibus Loan and Security Agreement, when the travel industry is expected to have fully recuperated” from the effects of the coronavirus pandemic, it added.
The airport company’s lenders are BDO Unibank, Philippine National Bank, Bank of the Philippine Islands, Development Bank of the Philippines, Land Bank of the Philippines, Metropolitan Bank and Trust Company, and Asian Development Bank.
Megawide Chairman and Chief Executive Officer Edgar B. Saavedra said the agreement is a “strong sign of support and confidence” in the company’s airport business model.
“The more relaxed debt servicing schedule will provide our airport operations a clearer runway to full recovery once the situation normalizes,” he added. — Arjay L. Balinbin