Sept 20 (Reuters) - One of the two investors in Puerto Rico’s largest airport is exploring selling a 50 percent stake in a joint venture that runs it under a lease agreement with the Caribbean island’s government, people familiar with the matter said on Tuesday.
The move comes as passenger traffic at the airport has proved resilient in the face of Puerto Rico’s $70 billion debt crisis, a decade-long recession, and the fallout on tourism from concerns over Zika, the mosquito-born virus linked to serious birth defects.
Luis Munoz Marin Airport, the busiest in the Caribbean, was privatized in 2013 with the granting of a 40-year concession to a consortium called Aerostar Airport Holdings LLC.
Private equity firm Oaktree Capital Group LLC, half-owner of Aerostar, is working with investment banks on a sale of its stake, the sources said.
Mexico’s Grupo Aeroportuario del Sureste SAB de CV , known as ASUR, owns the rest of Aerostar.
The sources asked not to be identified because the matter is not public. Oaktree declined to comment. Aerostar and ASUR did not respond to requests for comment.
About 20,000 people in Puerto Rico have been diagnosed with Zika, including more than 1,700 pregnant women. The disease has hurt the economy, prompting the cancellation of a pair of MLB baseball games earlier this year. U.S. airlines have had to slash leisure fares to the island as well.
Some analysts have cited the lifting of the Cuba travel embargo as another potential blow to Puerto Rican tourism, though the nearby country lags far behind other Caribbean destinations in infrastructure.
Total passenger traffic at San Juan’s airport increased 4.31 percent year-on-year to 2.3 million in the second quarter, according to ASUR’s latest earnings release.
The concession to run the airport has a revenue cap of $62 million per year for the first five years. The contract then shifts to a long-term revenue sharing agreement between the airport owner, the Puerto Rico Ports Authority and Aerostar, according to Federal Aviation Administration documents.
Puerto Rico officials valued the airport concession at $2.57 billion when it was awarded. This included a $615 million up-front payment, and annual revenue-sharing payments estimated to add up to $552 million. (Reporting by Mike Stone and Nick Brown in New York; Additional reporting by Jeffrey Dastin and Greg Roumeliotis in New York; Editing by Richard Chang)