- March 8, 2021
RF Bank & Trust (RF) President and CEO, Mr. Michael Anderson, announced the investment bank’s engagement as the Financial Advisor and Placement Agent to raise capital to fund local airport development projects. It is expected that RF will raise up to US$150M on behalf of The Bahamas Airport Authority over a period of eighteen to twenty-four months through bond offerings open to Bahamian investors. The funds raised will provide the financing to renovate and expand various Family Island airports including facilities on Exuma, Long Island, Abaco, Great Harbour Cay, and North Eleuthera. The improved facilities will significantly increase their passenger-handling capacity and improve air access to the islands, so they are better positioned for increased tourism.
“RF is excited about this opportunity to assist the Airport Authority with the improvement and expansion of its airport facilities” Mr. Anderson said. “These projects will serve as a catalyst towards recovery in The Bahamas following the devastating impact of the COVID-19 crisis and Hurricane Dorian and will lead to the resumption of growth in the local economies.”
Director of Aviation, Algernon Cargill, noted that the investment will be beneficial in creating local employment opportunities and stimulating economic activity on the Family Islands. “One of our key goals is to ensure that all our facilities meet international standards which is urgent given current economic challenges”, he said. “Deficiencies in family island airports greatly impede their earning potential from a commercial and a tourism standpoint. Through this Public-Private Partnership (“PPP”), we will address these deficiencies and provide a means of economic growth while not placing any burden on the public purse.”
RF has raised nearly $1,9 billion for Caribbean based entities since the investment bank commenced business in 1997. More recently, the bank acted as the Co-Financial Advisor and Placement Agent to the Nassau Airport Development Company in its successful offering of over $134 million in bonds in 2019. Jim Wilson, RF Vice President, and head of RF’s Investment Banking Division, said this transaction marks a major milestone for the regional investment bank.
“We are excited to bring a deal of this size to market for Bahamian investors that will also help to boost the country’s economic recovery”, he said. “RF is especially pleased to participate in a project that will have such a significant impact on tourism. With the planned renovations, the Family Islands will be well poised for the anticipated increase in demand once the COVID-19 vaccine becomes more widely available.”
Local contractors will be engaged for the renovation and expansion works and RF will raise funding in line with construction schedules. According to Mr Cargill, a Special Purpose Company (SPC) will be created, and the airports will be licensed to an Operator to manage and operate them based on a similar model used by the Nassau Airport Development Company. The total expected cost is between USD $130M to USD $150M which includes loans from the Inter-American Development Bank (IDB). The airport renovation and expansion project is scheduled to take 18 to 24 months to complete.