2nd Jul 2021 19:21
(Alliance News) - Esken Ltd on Friday said it has secured GBP125 million financing for its Southend Airport unit from Carlyle Group.
The airport and aviation services operator has signed an agreement with CGIOF River Sarl, controlled by Carlyle Global Infrastructure Opportunity Fund LP, for a senior loan. The financing is convertible to just shy of a 30% stake in London Southend Airport Co Ltd. This will rise to 30% upon approval from the Office for Rail & Road, a UK watchdog.
Net of lender costs, the financing package will amount to GBP120 million. Esken said GBP100 million will be provided to the company, with another GBP20 million ring-fenced to provide Southend Airport support for a forecast period of three years.
"Any additional capital investment required in the medium to long term by the borrower [Southend Airport] is expected to be raised as debt funding by the borrower group, ring fenced from the rest of Esken," the company added.
"In addition to the funding being provided, CGI brings significant expertise in investing in and developing airports around the world. This, together with the experienced operational team at LSA will enhance Esken's offering for existing and prospective airline and logistics partners."
Esken Executive Chair David Shearer noted Carlyle Global Infrastructure is a "true strategic development partner".
"Carlyle is a global investment firm with USD260 billion under management. The combination of the proven operational capability of the LSA management along with the airport development experience of CGI and its financial strength will provide a strong platform as we rebuild our commercial relationships with our airline and other partners into the recovery," Shearer added.
Esken shares closed down 0.4% at 26.05 pence each in London on Friday.
By Eric Cunha; [email protected]
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