Mexico City Airport Bondholders Reject Enhanced Proposal

Holders of about half of the $6bn in debt issued to finance a Mexico City airport project that is now destined to be scrapped rejected the government’s enhanced proposal on Wednesday, saying it was better, but still nowhere near good enough, the Financial Times reported. The rejection from the self-styled Ad Hoc bondholder group came despite bond markets giving an initial thumbs-up to the revised official offer that fuelled Mexican government optimism that a deal may be in the bag by next week. “While the group recognises that the amended proposal makes incremental improvements, fundamental problems remain such that the group cannot support the amended proposal in its current form,” the group, represented by law firm Hogan Lovells, said in a statement. There was no immediate reaction from the Mexican government. Bonds issued by the Mexico City Airport Trust (Mexcat) to finance construction of the $13bn Norman Foster-designed airport rallied sharply after the government on Tuesday night sweetened the terms of its offer after saying it had taken on board bondholder concerns. Read more

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