Archive for the ‘News’ Category

DOTC, GMR-Megawide ink Mactan airport deal

Philippine Daily Inquirer, 23 April 2014

By Miguel R. Camus


Winning consortium pays cash premium of P14.4B

The Department of Transportation and Communications on Tuesday signed the contract with the Filipino-Indian consortium that bagged the Mactan-Cebu International Airport public private partnership deal, paving the way for the construction of a brand new terminal by 2018.

The concession agreement was signed after winning consortium GMR Infrastructure of India and Megawide Construction Corp. completed the post-award requirements, including the payment yesterday morning of a P14.4-billion cash “premium” days ahead of the April 24 deadline.

The move marks the second PPP contract-signing for DOTC, which had been criticized for the slow pace in rolling out massive infrastructure deals.

The Cebu airport deal still faces challenges though as the award is being contested by Sen. Sergio Osmeña III in the Supreme Court after the Cebuano politician questioned GMR’s capability to undertake the project.

With the concession agreement signed, events have overtaken the filing made by Osmeña, which came a day before GMR-Megawide was awarded the project last April 4.

Transportation undersecretary Jose Lotilla noted Tuesday that the filing may, thus, need to be revised.

“The concession agreement was signed,” Lotilla said. “It depends now on what they [Osmeña’s group] are trying to restrain.”

GMR-Megawide, meanwhile, said they would proceed with the project barring any order from the High Court.

Megawide chair and CEO Michael Cosiquien said the project would turn Cebu’s airport into a word-class facility that would serve as a regional hub.

Apart from new airport facilities, Cosiquien said the GMR-Megawide consortium would develop an adjacent six-hectare property into a retail complex and hotel, but he declined to elaborate.

“This is really a project all of us can be proud of,” Cosiquien said in a prepared speech during the signing.

Referring to the DOTC, he added that the agency had “restored our faith in government by conducting a fair and transparent bid and awarding process.”

The P14.4-billion premium GMR-Megawide paid comes on top of the P17.5 billion to be mainly spent on a new passenger terminal, which would help the congested airport handle about 25 million passengers annually by the end of the 25-year concession period.

Mactan-Cebu Airport, which was meant to handle 4.5 million per year, was visited by close to seven million passengers in 2013, government data showed.

The consortium would mainly earn from the commercial development and terminal fees, which would still be regulated by the government.

GMR-Megawide, whose offer topped six other bidders last Dec. 12, was expected to assume operations of the Cebu airport by October this year, the DOTC said in a separate statement Tuesday.


GMR-Megawide set to renovate, expand Mactan airport

The Manila Times, 23 April 2014

By Rosalie C. Periabras


After much delay in the finalization of the awarding of the development concession for the Mactan-Cebu International Airport, winning bidder GMR-Megawide consortium is now set to renovate, expand and operate the facility. The group recently signed a 25-year concession agreement with the Department of Transportation and Communications (DOTC), after fulfilling all post-award requirements, including payment to the Mactan-Cebu International Airport Authority of the P14.4-billion premium it offered. “The premium itself is about P14.4 billion, [and] including VAT [value-added tax]-it’s about P16.1 billion. Just for the terminal building, we are looking at P17.5 billion,” said Michael Cosiquien, chairman and chief executive officer of GMR-Megawide. “We provided 30 percent equity and 70 percent debt, [which was] provided by BDO [Banco de Oro],” Cosiquien said. He added that of the 30-percent equity, Megawide will provide 60 percent and GMR 40. “We haven’t finalized the [total] costing yet. The P17.5 is for the airport only,” he said.


French keen on investing in PPP projects

Manila Bulletin, 22 April 2014 / Yahoo, 23 April 2014

By Roy Mabasa


Manila, Philippines — French companies, mostly from the infrastructure and energy sectors, are keen on expanding their businesses in the Philippines while others are looking to bid for future government projects in the country under the public–private partnership (PPP) venture.

The interest to invest in the Philippines was expressed by high-level French businessmen who recently flew to Manila to take -part in an investment mission organized by the Mouvement des enterprises de France (MEDEF), the French Embassy in Manila, and the Philippine Embassy in Paris.

The 23-man delegation represent, various French companies involved in  airport design and construction (Aéroports de Paris, Vinci Airports); energy (Green Lighthouse); financial services (Crédit Agricole); infrastructure, transport, and public works (Citelum, Egis, SNC Lavalin, Systra, Vossloh Cogifer); (Socotec); shipbuilding (Ocea); and spatial (Collecte Localisation Satellite).

Several French companies are already present in the country, such as Airbus, Alstom, Bureau Veritas, Cofely, Freyssinet, Matiere, Socotec and Systra, and Total.

Meanwhile, French multinational electric utility company, GDF Suez and Tractebel, on the other hand, are poised to open its respective offices in the Philippines within the year.

A third of the participating companies were from the CAC 40 or the French equivalent of the Dow Jones.

According to the Department of Foreign Affairs (DFA), total trade between the Philippines and France reached almost $2 billion in 2013, up by 55 percent from 2012.


DOTC finalizes infrastructure design for Common Station project

Business Mirror, 22 April 2014

By Lorenz S. Marasigan


The P1.4-billion Light Rail Transit Line 1 (LRT 1) North Extension Project, otherwise known as the Common Station, will be built in front of TriNoma Mall in Quezon City as this would result in about P1-billion savings to the government.

Transportation Undersecretary for Planning Rene K. Limcaoco said that the final design for the infrastructure is scheduled to be done as early as June this year.

The government has been studying which mall in North Edsa would best suit the parameter set on the common hub between the Sy-led SM North Edsa Annex or TriNoma Mall which is owned by the Ayala family.

And based on government studies, building the common hub near TriNoma would result in a billion-peso in savings, less urban blight and a faster construction of a turn-back railway system, the official said.

“The design for the common station is longitudinal, so you would argue that it is almost equidistant between everyone [including SM North Edsa Annex], it’s not only at TriNoma,” Limcaoco said.

SM Prime Holdings Inc. earlier made a P200-million down payment to the Light Rail Transit Authority (LRTA) for the naming rights of the station.

Transportation Secretary Joseph Emilio A. Abaya had said that the government is ready to return the down payment to the Sy-led firm.

But his undersecretary said that it is not necessary to do so, as the station could still be named after the SM Group.

“It can still be named. It’s not necessarily going to be named ‘TriNoma’; it can be called ‘SM-TriNoma’, ‘TriNoma-SM’, ‘Edsa-TriNoma-SM’, whatever you want to call it,” Limcaoco explained.  The said project will be auctioned off along with the P64.9-billion LRT 1 Cavite Extension contract. The prospect has yet to be finalized.

The common hub will link three mass-railway systems in Metro Manila, namely, LRT 1, Metro Rail Transit Line 3 (MRT 3) and the proposed MRT Line 7 (MRT 7).

The common station project also involves the construction of head-to-head platforms for LRT 1 and MRT 3 with a 147.4-meter elevated walkalator to MRT 7 on North Avenue.

The P62.7-billion MRT 7 project, meanwhile, entails the construction of 14 train stations starting from San Jose del Monte in Bulacan to North Avenue in Quezon City. The government is poised to award the multibillion-peso contract to San Miguel Corp. after reaching financial closure.

At present, LRT 1 runs from Baclaran to Roosevelt in Quezon City, while the MRT 3 runs from North Avenue in Quezon City to Taft Avenue in Pasay City.


DOTC mulls ‘Solomonic’ solution to location of LRT-MRT common station

InterAksyon, 22 April 2014

By Darwin G. Amojelar


MANILA – Amid criticism about its award of two other public-private partnership (PPP) projects, the Department of Transportation and Communications (DOTC) has proposed a “Solomonic” solution to the problem of where to build the common station for the LRT 1 and MRT 3.

Ayala Land and SM Prime are interested in having the common station built near their respective malls — the TriNoMa and SM North Edsa — each facing the other at the corner of Edsa and North Avenue in Quezon City.

SM Prime earlier paid P200 million to state-run Light Rail Transit Authority (LRTA) for the naming rights to the common station, but DOTC officials cited savings of as much as P1 billion should the facility be built near the TriNoMa.

“When we saw, you know the station will be large, right? And it’s longitudinal, so you would argue that it is almost equidistant between everyone, it’s not only at TriNoMa,” Transport Undersecretary Rene K. Limcaoco told reporters on the sidelines of today’s contract signing for the Mactan Cebu International Airport project.

Limcaoco said the design of the common station should be issued within two months.

He said the common station could still be named SM even though the facility would be closer to TriNoMa.

“It’s not necessarily going to be named ‘Trinoma’. It can be called ‘SM-Trinoma’, ‘Trinoma-SM’, ‘EDSA-Trinoma-SM’, ‘Megamall’, whatever you want to call it,” he said.

Limcaoco’s statement comes after DOTC’s award of the Mactan airport project, as well as of the Automated Fare Collection System (AFCS), met with opposition from losing bidders.

In the case of the AFCS, the SM Group had questioned the award of the project, which would involve providing a common ticket scheme for LRT and MRT, to the consortium of the Ayala Group and Metro Pacific Investments Corp (MPIC).

In November last year, Malacanang approved the P1.4 billion construction of the LRT Line 1 North Extension Project – Common Station.

The project involves the provision of a common station for LRT1, MRT3 and eventually MRT7. Head to head platforms for LRT1 and MRT3 with a 147.4-meter elevated walk-a-lator to the proposed MRT7 at North Avenue will be constructed.

LRT1 runs from Baclaran to Roosevelt in Quezon City, while the MRT3 runs from North Avenue in Quezon City to Taft Avenue in Pasay City.

The planned P62.7 billion MRT7 involves the construction of a 22.8-kilometer rail system from North Avenue station in Quezon City, passing through Commonwealth Avenue, Regalado Avenue and Quirino Highway up to the proposed Intermodal Transportation Terminal (ITT) in San Jose del Monte, Bulacan. This project will cover 14 stations.


Cabinet members endorse Laguna Lakeshore Expressway project for PNoy approval

InterAksyon, 22 April 2014

By Darwin G. Amojelar


MANILA – Cabinet members of the inter-agency Investment Coordination Committee of the National Economic and Development Authority (NEDA-ICC) have cleared the P122.8-billion project to build an expressway that would circle the Laguna de Bay.

Cosette Canilao, executive director of the Public-Private Partnership (PPP) Center, told reporters today that the Cabinet committee of the NEDA-ICC has endorsed the Laguna Lakeshore Expressway Dike (LLED) Project for President Benigno Aquino III’s approval.

After approval by the NEDA board, which the President chairs, the project would be offered to the private sector, Canilao said.

Of the total P122.8 billion budget, P64.9 billion would be allotted for constructing the expressway dike and P57.89 billion for land reclamation.

The project has the following components:

- A 47-kilometer expressway dike with two (2) sections as follows: Bicutan-Calamba and Calamba-Los Baños; and

- Reclamation of 500-700 hectares of raw land and horizontal development of the same for mixed use.

The project aims to provide a high-standard highway that will speed up traffic between the southern part of Metro Manila and Laguna, as well as a dike that would mitigate flooding in the western coastal communities along Laguna Lake.

The proposed alignment runs 500 meters off the shoreline of the Laguna Lake.

The LLED is among the Department of Public Works and Highways’ (DPWH) PPP projects, which also includes the P35.42-billion Cavite Laguna Expressway (CALAX).

To date, the agency has awarded two other PPP projects, namely the P2.01 billion Daang Hari-SLEX to the Ayala group, and the P15.52 billion NAIA Expressway to Optimal Infrastructure of San Miguel Corp.


Megawide-GMR remits P16.1-B payment for Cebu airport project

The Philippine Star, 23 April 2014

By Lawrence Agcaoili


MANILA, Philippines – The tandem of Filipino-owned Megawide Construction Corp. and Bangalore-based GMR Infrastructure remitted yesterday to the goverment  the P16.1 billion paymentfor the country’s first airport public private partnership (PPP) project.

The remittance of the premium payment paved the way for the signing of the concession agreement between the Department of Transportation and Communications (DOTC) and the Megawide-GMR Group yesterday.

DOTC undersecretary Jose Perpetuo Lotilla, GMR Infrastructure Airports chairman Srinivas Bommidala, and Megawide chairman and chief executive officer Machael Cosiquien

led the signing of the concession agreement for the P17.5 billion Mactan Cebu international airport expansion project.

Cosiquien said in an interview with reporters after the hastily called signing ceremony that the tandem yesterday paid P16.1 billion to the Mactan Cebu International Airport Authority (MCIAA) including the P14.4 billion premium payment as well as P1.7 billion value added tax (VAT).

He said the joint venture that is 60 percent owned by Megawide and 40 percent owned by the GMR Group contributed 30 percent of the total initial payment while BDO Unibank extended a loan to finance the 70 percent.

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He pointed out that the company is spending P17.5 billion for the construction of a new passenger terminal building starting January or February next year.

According to him, the joint venture is also looking at developing another six-hectare property within the country’s second busiest airport into a mixed-use commercial area that would include a hotel, shopping malls, among others.

Cosiquien said the tandem is talking to several international lenders including the World Bank (WB) as well as the Asian Development Bank (ADB) to finance the PPP project.

He explained that the DOTC and MCIAA would turn over the operation and maintenance of the country’s second busiest airport to the Megawide – GMR tandem in October.

The new passenger terminal building dedicated for international flights would be completed by January 2018 paving the way for the renovation of the existing terminal.

Bommidala said the signing of the project would boost bilateral ties between the Philippines and India.

“This is the largest investment between an Indian and a Filipino company in the Philippines’ largest privatization program, and I am happy to be part of this,” he stressed.


Megawide signs Mactan deal

Manila Standard Today, 23 April 2014

By Lailany P. Gomez


The consortium of Megawide Construction Corp. and GMR Infrastructure Ltd. of India on Tuesday signed a 25-year concession agreement with the government for the construction and operation of the P17.5-billion Mactan-Cebu International Airport.

The contract signing between Megawide-GMR consortium and the Transportation Department followed the expiration of the 15-day period, when no party filed a petition to contest the award.

Megawide-GMR, which beat six other bidders including the Filinvest-Changi consortium which submitted the second highest bid and asked for the disqualification of the winning group, settled all post-award requirements, including the payment of the P14.4-billion premium it offered as financial bid.

Megawide chairman and chief executive Michael Cosiquien said the consortium had paid the upfront payment through a combination of equity and loans from BDO Unibank Inc.

“The P14.4-billion premium payment to the government, we worked with BDO. We provided equity of 30 percent and 70 percent from bank loan,” he said.

Under the agreement, operations and maintenance of the airport will be turned over by Mactan-Cebu International Airport Authority to Megawide-GMR within the next six months.

The concessionaire is expected to start the construction of the new passenger terminal building by January 2015 and complete it in three years, or by January 2018.

The new terminal will be dedicated to international flights and will rise next to the existing passenger terminal building, to which it will be connected.

The existing terminal, which will be renovated and completed by January 2019, will serve as the airport’s domestic terminal.

Transportation Undersecretary Perpetuo Lotilla said the agency signed the agreement after no party filed a motion for reconsideration and in the absence of any decision from the court stopping the deal.

“So now since the concessionaire agreement has been signed, they [petitioners] need to amend their petition,” Lotilla said.

“TRO [temporary restraining order] is a discretionary remedy, [but] it depends on the court. It is an extraordinary remedy in law. So you don’t just issue it just like that. It is only done if you are trying to avert a damage which cannot be corrected that is normally the ground,” Lotilla said.


Mactan-Cebu airport contract signed

Malaya, 23 April 2014


Mactan-Cebu International Airport, the country’s second busiest airport, will soon undergo a major upgrade following the signing yesterday of a 25-year Concession Agreement between the Department of Transportation and Communications (DOTC) and winning consortium GMR-Megawide.

The Concession Agreement was signed as GMR-Megawide fulfilled all post-award requirements, including payment to the Mactan-Cebu International Airport Authority (MCIAA) of the P14.4-billion premium it offered as its financial bid.

The airport’s operations and maintenance (O&M) will be turned over by MCIAA to GMR-Megawide within the next six months.

This means the public can expect private sector efficiency and more customer-oriented services at the airport beginning in October 2014.

GMR-Megawide should also begin constructing the new passenger terminal building (PTB) by January 2015, which it should complete in three years, or by January 2018.

This new terminal will be dedicated to international flights and will rise next to the existing PTB, to which it will be connected.

The existing PTB will then be renovated for completion in January 2019, when it will begin to serve the airport’s domestic clientele exclusively.


GMR-Megawide consortia inks concession pact for Mactan-Cebu Airport project

EPC World, 22 April 2014


Bangalore: GMR-Megawide Consortium today signed a formal concession agreement with the Department of Transportation and Communications (DOTC) for the up gradation of Mactan-Cebu Airport project in Philippiness.

An upfront payment of Philippine Pesos 14.4 billion (approx. US $320 million) has been made towards the Mactan Cebu International Airport Authority within the stipulated time. “By making the upfront payment of P14.4 billion within the stipulated time we have clearly demonstrated our credentials and capabilities to take up this prestigious project,” expresses G.M. Rao, Group Chairman, GMR Group.

The 25 year concession agreement was signed between the Department of Transportation and Communications (DOTC), Republic of Philippines, Mactan Cebu International Airport Authority (MCIAA) and GMR Megawide Consortium after the winning consortia fulfilled post award requirements.

In December 2013, amidst international competitive bidding, GMR has bid for Mactan-Cebu airport project with one of Philippine’s leading construction firms Megawide Construction. The consortia emerged as the highest bidder for the project and the Letter of Award was issued by DOTC on April 4, 2014.

Under the agreement, within next six months Mactan-Cebu International Airport Authority will handover operations and maintenance of the airport to GMR- Megawide.  The construction of new passenger terminal, dedicated to international flights, is expected to start by January 2015 and completed in three years.

“This is just the first step in our endeavour to transform the Mactan Cebu International Airport into a world class airport destination. Using GMR Group’s proven expertise in airport development and operations, we will focus our efforts in making MCIA into an efficient passenger-oriented and commercially sustainable airport that will make a significant contribution to the economy of Cebu,” states Rao.