A lot is at stake with the first sale of Mexican airports next month, The aim is not just to work state assets harder but to create a structure that will serve as a corporate governance model for the entire Mexican private sector.
The government is still smarting from privatization failures such as the banks and the roads. It's aware of the desperate need to improve business standards in Mexico where majority shareholders frequently ride roughshod over minorities, and is trying to put the house in order by way of example.
Mexico's airports are not the standard fare of privatization. Many of them are profitable and apart from Mexico City, which needs a new airport, investment requirements are moderate. But the government wants to privatize to allow international operators to come and run them in an independent and modern way, and to provide a role model for Mexican corporate life.
The sale, in which Warburg Dillon Read is acting as adviser, has been structured so that the strategic partners cannot own more than 15% of the equity and must hold on to 7.5% for 10 years. An option to acquire an additional 5% three years later will ensure the partners' are motivated to improve the share price.