SEC Info - Macquarie Infrastructure Corp.

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934

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MACQUARIE INFRASTRUCTURE CORPORATION
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Macquarie Infrastructure Corporation Sales of Remaining Businesses, Atlantic Aviation and MIC Hawaii September 2021

Important Information For Investors And StockholdersIn connection with the proposed transactions, Macquarie Infrastructure Corporation (the “Company”) has filed a definitive proxy statement with the Securities and Exchange Commission (“SEC”) on August 23, 2021 which has been mailed to stockholders of the Company. INVESTORS AND SECURITY HOLDERS OF THE COMPANY ARE STRONGLY ENCOURAGED TO READ THE PROXY STATEMENT AND OTHER DOCUMENTS THAT ARE FILED OR WILL BE FILED WITH THE SEC CAREFULLY AND IN THEIR ENTIRETY BECAUSE THEY CONTAIN OR WILL CONTAIN IMPORTANT INFORMATION. Investors and security holders may obtain free copies of the proxy statement and other documents filed with the SEC by the Company through the website maintained by the SEC at https://www.sec.gov. Copies of the documents filed with the SEC by the Company will also be available free of charge on the Company website at www.macquarie.com/mic or by writing to us at 125 West 55th Street, New York, New York 10019, United States of America, Attention: Investor Relations.Certain Information Regarding ParticipantsThe Company and its directors and executive officers may be considered participants in the solicitation of proxies in connection with the proposed transactions. Information about the directors and executive officers of the Company is set forth in its Annual Report on Form 10-K for the year ended December 31, 2020, which was filed with the SEC on February 17, 2021, and its definitive proxy statement for its 2021 annual meeting of stockholders, which was filed with the SEC on March 29, 2021. Other information regarding the participants of the Company in the proxy solicitation and a description of their direct and indirect interests, by security holdings or otherwise, will be contained in the proxy statement and other relevant materials to be filed with the SEC regarding the proposed transactions when they become available.Disclaimer on Forward Looking StatementsThis communication contains forward-looking statements. The Company may, in some cases, use words such as “project,” “believe,” “anticipate,” “plan,” “expect,” “estimate,” “intend,” “should,” “would,” “could,” “potentially,” “may” or other words that convey uncertainty of future events or outcomes to identify these forward-looking statements. Such statements include, among others, those concerning the Company’s expected financial performance and strategic and operational plans, statements regarding sales of the Company’s operating businesses (including the Company’s previously approved reorganization) and the anticipated usesof any proceeds therefrom, statements regarding the anticipated specific and overall impacts of COVID-19 and any related recovery, as well as all assumptions, expectations, predictions, intentions or beliefs about future events. Forward-looking statements in this communication are subject to a number of risks and uncertainties, some of which are beyond the Company’s control, including, among other things: changes in general economic or business conditions; the ongoing impact of the COVID-19 pandemic; the Company’s ability to complete the sales of its operating businesses; uncertainties as to the timing of the consummation of the proposed transactions; the risk that conditions to closing of the proposed transactions are not satisfied, including the failure to timely obtain the requisite stockholder approvals or regulatory clearances; the occurrence of any event giving rise to a termination of the proposed transactions; the Company’s ability to service, comply with the terms of and refinance debt; its ability to retain or replace qualified employees; in the absence of a sale or sales of its businesses, its ability to complete growth projects, deploy growth capital and manage growth, make and finance future acquisitions and implement its strategy; the regulatory environment; demographic trends; the political environment; the economy, tourism, construction and transportation costs; air travel; environmental costs and risks; fuel and gas and other commodity costs; the Company’s ability to recover increases in costs from customers; cybersecurity risks; work interruptions or other labor stoppages; risks associated with acquisitions or dispositions; litigation risks; reliance on sole or limited source suppliers, risks or conflicts of interests involving the Company’s relationship with the Macquarie Group; and changes in U.S. federal tax law. These and other risks and uncertainties are described under the caption “Risk Factors” in Item 1A of the Company’s Annual Report on Form 10-K for the year ended December 31, 2020 and in its other reports filed from time to time with the SEC.The Company’s actual results, performance, prospects, or opportunities could differ materially from those expressed in or implied by the forward-looking statements. Additional risks of which the Company is not currently aware could also cause its actual results to differ. In light of these risks, uncertainties, and assumptions, you should not place undue reliance on any forward-looking statements. The forward-looking events discussed in this communication may not occur. These forward-looking statements are made as of the date of this communication. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. Important Notice

Sale of MIC Hawaii to Argo Infrastructure for $514 million2 – or ~12.9x 2021E EBITDA3 – announced June 2021 Sale of IMTT to affiliate of Riverstone Holdings for $2.685 billion completed December 2020 Excluding non-cash items, as defined by managementUnitholders to receive $3.83 per unit at closing (or, if the transaction is consummated after July 1, 2022, $4.11 per unit at closing).12.9x 2021E EBITDA at the midpoint of MIC EBITDA guidance.Based on the 60-day VWAP to October 31, 2019. Sales of Atlantic Aviation and MIC Hawaii To Conclude Strategic Alternatives Process Sale of Atlantic Aviation to KKR for $4.475 billion – for industry record multiple of ~16.2x 2019A EBITDA1 – announced June 2021 1 2 3 Since 2018, MIC has focused on enhancing the infrastructure characteristics of its operating businesses and improving their resilienceIn October 2019, the Company announced that it would pursue strategic alternatives to operating as a public company as a means of unlocking additional value for shareholdersThe Atlantic Aviation and MIC Hawaii transactions together successfully conclude a complex and robust strategic alternatives processAggregate proceeds from sales of MIC’s three operating businesses are expected to total $52.18 per share, representing an approximately 35%4 premium to the share price prior to announcement of strategic alternatives process

Special Meeting of Shareholders scheduled for September 21, 2021 MIC’s Board of Directors unanimously recommends a vote FOR both transaction proposals Reasons to Vote FOR Proposals Eliminates market risk for shareholders / unitholders Tax efficient structure and flexibility in order of sales Attractive valuations following robust sales processes 1 2 3 Aggregate proceeds from sales of MIC’s three operating businesses expected to total $52.18 per share, representing approximately 35%1 premium to share price prior to announcement of strategic alternatives processBoard believes the all-cash consideration represents attractive value for shareholders / unitholdersPurchase prices compare favorably to recent comparable transactionsFairness opinions received from two financial advisors, Lazard and EvercoreRobust sales processes both pre- and post-COVID Atlantic Aviation transaction is not expected to result in corporate level tax capital gains taxShareholder approval in May 2021 of a corporate reorganization facilitates the sale of Atlantic Aviation without subjecting the transaction to the potentially lengthy approval process of the Hawaii Public Utilities Commission Public-style, locked box transaction structures with no purchase price adjustments or surviving representationsFinancial performance risk transferred to the purchasers as of a specific dateClarity with respect to timing and amount of proceeds Based on the 60-day VWAP to October 31, 2019.

Sale of Atlantic Aviation Transaction multiple of 16.2x 2019A EBITDA1 is expected to be a record price for FBO industryValuation implies no discount for COVID-19 and captures fundamental decrease in risk perception of FBO business and the resilience of Atlantic Aviation’s portfolio Compares favorably to Signature Aviation transaction multiple of 15.6x 2019A EBITDA2, and 12.9x 2019A EBITDA2 adjusted for share-based payments and midpoint of announced cost-savings Rapid rebound of general aviation activity following the pandemic solidified value propositionGeneral aviation activity was down ~70% in April 2020, but recovered to pre-pandemic levels by May 2021 boosted by both existing users and new customers substituting from commercial aviationHigher relative volume to leisure destinations due to shut-down of metropolitan centers and greater work-from-home flexibility Shareholders compensated for the expected full recovery / forecast for Atlantic Aviation businessAfter receiving first round indications of interest, Atlantic Aviation was able to point to superior performance relative to budget and a positive demand response to improving macroeconomic conditions, with a corresponding increase in public EBITDA guidanceContinued improvements in short-term performance reinforced bidder conviction around the resilience of the business and the robust long-term outlook Transaction concludes an extensive sale process prior to and following the onset of the COVID-19 pandemicInitial outreach to 48 parties regarding a sale of Atlantic Aviation, plus additional pre-pandemic outreach to 29 parties in connection with the sale of the entire company, of which there was a strong interest in an Atlantic Aviation-only transaction28 acquisition NDAs executed; in 2021, received 9 first round offers, 3 final binding offers and 3 “best and final” offers Excluding non-cash items as defined by management.Represents pre-COVID 2019 EBITDA of $348.7 million adjusted for $8.6 million of share-based payment and illustrative cost savings of $75 million (midpoint of $70 million - $80 million range).

Excluding non-cash items, as defined by managementAs of December 31, 2020, weighted based on 2019A EBITDA.Tier 1 defined as airport pumping over 2.5 million gallons p.a.; Tier 2 defined as airports pumping 750 thousand – 2.5 million gallons p.a.; Tier 3 airports pumping less than 750 thousand gallons p.a. Transaction Summary Atlantic Aviation Overview Sale of Atlantic Aviation (cont’d) Second largest FBO operator in the United States with 69 locationsProvides fueling, terminal, hangar and ramp facilities and associated services to owners and operators of general aviation aircraftFacilities network strategically positioned in major markets across the United StatesHeadquartered in Plano, TX, ~1,800 employees nationwide2019A EBITDA1: $276 million2010A-2019A EBITDA1 CAGR: 9.9%Avg. Sr. Management Experience: 25+ yearsWeighted Average Lease Life: ~20 years2 All-cash transaction with KKRUnitholders expected to receive a distribution of $37.35 per unit following closingImplied enterprise value of $4.475 billion; ~16.2x 2019A EBITDA1Following the reorganization of MIC and distribution of MIC Hawaii, KKR will purchase 100% of the equity interests of MIC, which will include Atlantic Aviation and all residual assets and liabilities of MIC not related to MIC HawaiiTransaction close expected during 3Q21, subject to satisfaction of closing conditions including shareholder approval Market Size3 Offering 2019A Gross Profit

Sale of MIC Hawaii Attractive valuation despite fundamental and shift in risk perception with COVID-19 demonstrating significant exposure to Hawaii tourism Visitors to Hawaii declined to near zero for most of 2020 resulting in a decrease in gas sales of 26%Recovery to 2019 volumes expected post-2024; economic forecasters cautious regarding pace of recovery as long-distance travel remains heavily dependent on public sentiment with respect to travel safety Effects sale transaction for a business that may be sub-scale for a public companyAn estimated $11 million of annual corporate costs as a standalone public company post sale of Atlantic Aviation and not previously captured in MIC Hawaii’s EBITDA2 results reduces projected profitability and creates challenging equity story Transaction concludes a robust sale process by identifying a buyer with the ability and commitment to pay an attractive valuation and the necessary credentials to achieve a successful regulatory outcomeInitial outreach to 121 parties, including sponsors and strategics, resulted in 40+ NDAs being executed in connection with the sale of MIC Hawaii or the entire companyPublic knowledge that MIC has been seeking buyer for MIC Hawaii for over 18 months Installs new steward to support the business’ further alignment with the State of Hawaii’s energy goals Excludes the ~$11 million of ongoing listed costs. Regulated utility companies Atmos Energy Corporation, Chesapeake Utilities Corporation, New Jersey Resources Corp, Northwest Natural Gas Company, ONE Gas Inc., RGC Resources Inc., South Jersey Industries Inc., Spire Inc. and propane comparables Suburban Propane Partners LP, Superior PLus Corp. and UGI CorpExcluding non-cash items, as defined by management Transaction multiple of 12.9x1 2021E EBITDA and 12.2x1 2022E EBITDASuperior to blended multiple of comparable companies2 of ~10.5x and ~9.6x for 2021E and 2022E, respectively

If merger closes after July 1, 2022, unitholders will receive $4.11 per unit.At the midpoint of MIC EBITDA guidance; excludes the ~$11m of ongoing listed costs. Transaction Summary MIC Hawaii Business Overview Sale of MIC Hawaii (cont’d) Diversified energy distribution platform in Hawaii, consisting of Hawaii Gas (Propane Business and Regulated Utility segments; collectively branded “Hawaii Gas”) and two energy service businesses Propane Business Segment (leading propane business in Hawaii), and Regulated Utility Segment (only regulated gas utility franchise in Hawaii with ~$126 million regulated rate base), serve a combined ~70,000 customersClean Energy Segment includes clean energy power generation platform comprised of solar PV and cogeneration assets (~8.5 MW in operation)Headquartered in Honolulu, HI, ~340 employees All-cash transaction with Argo Infrastructure PartnersUnitholders expected to receive $3.83 per unit following closing1Implied enterprise value of $514 million; 12.9x 2021E EBITDA2Expected to close in the first half of 2022 subject to satisfaction of closing conditions including approval of Hawaii Public Utilities Commission and shareholder approval Revenues Volumes Business Segment Mix (2021E) Argo Regulatory Considerations Investor in utility infrastructure, with a longstanding track record of sustainable investing Experience with regulated energy assets, including recently announced acquisition of Corning Natural GasSupports Hawaii’s goal of carbon neutrality by 2045 and Hawaii Gas’ contributions to this goal

This ‘DEFA14A’ Filing	Date	Other Filings

	7/1/22
	9/21/21	4, 8-K
Filed as of:	9/2/21
Filed on:	9/1/21	8-K
	8/23/21	DEFM14A
	3/29/21	DEF 14A, DEFA14A
	2/17/21	10-K, 425, 8-K, SC TO-I, SC TO-I/A
	12/31/20	10-K, 5
	10/31/19	10-Q, 8-K
		List all Filings

Macquarie Infrastructure Corp. – ‘DEFA14A’ on 9/1/21

On: Wednesday, 9/1/21, at 6:12pm ET · As of: 9/2/21 · Accession #: 1157523-21-1113 · File #: 1-32384

Previous ‘DEFA14A’: ‘DEFA14A’ on 7/19/21 · Latest ‘DEFA14A’: This Filing

Additional Definitive Proxy Soliciting Material — Schedule 14A — Rule 14a-12

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