The Philippine Star, 23 December 2013
By Neil Jerome C. Morales
MANILA, Philippines – The Gotianun family’s Filinvest Development Corp. (FDC) is seeking the disqualification of the consortium of Megawide Construction Corp. and Bangalore-based GMR Infrastructure Ltd., the highest bidder for the P17.5-billion Mactan-Cebu International Airport (MCIA) project.
The conglomerate said the unsatisfactory performance record, financial woes, and questionable long-term commitment of GMR puts to risk the “rare opportunity” of creating a world-class airport, a claim refuted by a Mega-wide executive.
In a letter to the Pre-qualification, Bids and Awards Committee obtained by The STAR, FDC said it “could not remain silent after it had obtained publicly available information concerning the members of the consortium that submitted the highest financial proposal, particularly in relation to their capacity to realize this project.”
The tandem of Megawide and GMR topped the bidding for the MCIA with a financial offer of P14.404 billion, followed by the Filinvest-Changi Airport consortium (P13.999 billion) and Premier Airport Group led by SM mall and banking conglomerate (P12.5 billion).
However, FDC is contesting the award of the public-private partnership (PPP) to the Megawide-GMR consortium given several issues hounding the Indian firm.
For one, FDC said GMR Infrastructure is a member of GMR Group, whose contract to modernize the Male Ibrahim
Nasir International Airport was canceled by the Maldives government in December 2012.
MCIA bidders were required to submit a Notarized Certification of Absence of Unsatisfactory Performance Record indicating the companies’ contracts in the past five years were not terminated, suspended or materially violated.
Also, GMR Infrastructure is also facing opposition from state-owned Airports Authority of India (AAI) due to the airport operator’s unwillingness to infuse fresh capital into the $3-billion Delhi International Airport modernization project, choosing instead to charge passengers with extra fees, FDC said.
The Megawide-GMR Infrastructure consortium cited the Delhi International Airport for both the Development Experience and Operations and Maintenance Experience requirements.
For the financial woes, GMR Infrastructure took a hit after spending for the Maldives project that was canceled.
“GMR Infrastructure has suffered from major financial woes,” FDC said, adding that GMR Infrastructure has recorded successive quarter of losses following a single profitable fourth quarter that was preceded by nine consecutive quarters of losses.
“Considering the reported debt burden of GMR Infrastructure, the financial capacity of its Philippine partner becomes doubly significant,” FDC said.