AENA wins the Congonhas block in ANAC’s airport auction

The 7th round of airport concessions was marked by XP’s entry into the sector and by Spanish company Aena’s billion-real bid for the Congonhas (SP) lot, with a 231% premium. The infrastructure conglomerate now emerges as one of the largest private airport operators in the country, facing the challenge of making the concession sustainable amid the high number of loss-making terminals in the block.

Aena’s bid caused surprise in B3’s main hall. The minimum concession fee set was BRL 740.1 million. The Spanish company was the only bidder, offering BRL 2.45 billion. The infrastructure group will now operate 17 airports in Brazil, 11 of them from the 7th round alone, spread across the states of São Paulo, Mato Grosso do Sul, Pará and Minas Gerais. The planned investment for the concession exceeds BRL 5 billion.

“We want to contribute to the development of airports in Brazil. The country is an important part of our strategic vision for international expansion”, said the company’s international director, Maria Rubio.

The market had already been expecting little competition for the Congonhas block, amid a challenging macroeconomic scenario and political uncertainty. CCR, the country’s leading operator of large airports, pulled out of the process at the last minute. In this sense, Aena’s bid came as a surprise.

“The size of the premium was surprising, but Congonhas is very profitable. If, within this block, the company manages to make the other airports minimally profitable, including through regional aviation, the concession is likely to be sustainable; Aena already knows the Brazilian market and has other assets worldwide”, says Fabio Falkenburger, infrastructure partner and aviation specialist at Machado Meyer Advogados.

For the partner in the Public Law and Regulation practice at Lefosse, the tender was a success. “The auction was conducted efficiently by Anac, and Aena succeeded in having all the lawsuits seeking to suspend the process dismissed”, says the attorney, who was part of the firm’s team that advised Aena in the auction.

For Guilherme Naves, partner at consultancy Radar PPP, the participation of a single bidder in the contest for the block indicates that, overall, the market made a more conservative assessment of the assets in question. “But this is a global airport operator, which already has assets in Brazil”, he says.

In his view, it is reasonable to expect an improvement in the quality of the country’s services and infrastructure with the contracted investments. “But none of this will happen if contract management is not taken seriously and rigorously. What remains for us now is to monitor and oversee the concessionaires so that expectations can be met.”

Giamundo Neto Advogados partner Luiz Felipe Pinto Lima Graziano notes that, although the premiums for two blocks were significant, the absence of more traditional competitors sheds light on the model of grouping assets with different profiles in the same block. “This ended up driving away many operators. A company capable of operating a large airport is not always willing to operate loss-making terminals that are far apart.”

Debut

XP debuts as an airport operator after winning the business aviation block, made up of Campo de Marte (SP) and Jacarepaguá (RJ), with a bid of BRL 141.4 million, without a premium. According to the company, French firm Egis will handle the technical operation of the block under a five-year contract, as provided for in the tender notice.

The deal will be carried out through XP Asset, the group’s asset manager, which had more than BRL 141 billion in assets under management at the end of June. According to the head of XP Asset, Túlio Machado, the potential of the general aviation block goes beyond tariff revenue. “There is potential to explore the real estate segment.” He says XP Asset has a real estate arm, with logistics warehouses, shopping malls and office buildings. “It was a joint analysis between the infrastructure and real estate divisions.”

Expansion

The executive says the new Congonhas concession allows for expansion where business aviation terminals are currently located. “We believe that part of Congonhas’ market share should come to Campo de Marte; we plan to make the airport safer (with instrument flights)”, he said. “We believe airport fees will increase.”

According to Machado, XP Asset’s infrastructure private equity fund (FIP) was already involved in the sector through debt in areas such as energy (transmission and generation) and airports (in the 6th round). “This fund can look at the electricity, sanitation, transportation and telecom sectors; we operate very broadly in infrastructure”, says the executive. “We intend to invest in sanitation and other areas”, he adds.

He notes that the fund qualified to participate in the auction raised BRL 305 million in July. “We already have funds (for investments), but we should go to the market (to raise debt)”, he explains.

The head of XP Asset was enthusiastic about the recent tests involving electric vertical takeoff and landing vehicles (eVTOLs), known as “flying cars”, in Rio de Janeiro. “There is already a very strong helicopter operation at Jacarepaguá airport; we see potential for eVTOL development”.

North Block

In an open outcry contest, the Novo Norte Consortium, made up of Socicam and Dix Empreendimentos, won the North II block for BRL 125 million, a 119.7% premium over the minimum concession fee set in the tender notice of BRL 56.9 million.

The contest was against French company Vinci, which operates Salvador Airport (BA) and seven other terminals won in the 6th round last year. At the end of the contest, Socicam executives celebrated in B3’s main hall with cheers of euphoria.

After the auction, Infrastructure Minister Marcelo Sampaio said that the 8th round of airport concessions, scheduled for next year, depends largely on the “pace of the re-tendering of Galeão terminal (RJ)”.

“We are in the process of hiring the company that will carry out the studies (for the 8th round); this should happen in the first half of next year. Then the public hearing period begins, it goes to the TCU and then the tender notice is published”, he explained. “We expect to hold the auction at the end of next year, but this is closely tied to the pace of Galeão’s re-tendering; if there is any delay, this schedule may be adjusted”, he added.

News originally published by Agência Estado (in Portuguese), on 08.19.2022, written by Juliana Estigarríbia and Elisa Calmon