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.

 

23 April 2014

By Lailany P. Gomez