Brazil Auctions $14.2bn in Airport Concessions

Brazil managed to generate BRL24.53bn ($14.2bn) from investors in a licensing auction that opened the door for the private sector to modernize the country’s key airports. Brazil’s Investimentos e Participacoes em Infraestructura, Invepar, a construction company holding, and its partner Airports Company South Africa (ACSA), secured the concession for Sao Paulo’s Guarulhos airport by bidding BRL16.213bn. The 20-year concession with a year extension will be operated by a company 51% owned by Invepar and ACSA with the remaining 49% to be held by Brasileira de Infraestrutura Aeroportuaria, Infraero. The concession for the Viracopos airport in Campinas went to the group led by Triunfo Participacoes, with a BRL3.821bn bid, for a project that will require a roughly BRL8.7bn investment. The airport of Brasilia was won by Brazilian construction firm Engevix together with Argentina’s Corporacion America by bidding BRL4.5bn. The companies are expected to pay the initial installments of these investments next year and to pay the government a fee over the life of the concessions. It remains to be seen how the partners choose to finance their capital outlays for the projects.