Business World, 25 February 2013
By Cliff Harvey C. Venzon
LISTED conglomerates Metro Pacific Investments Corp. (MPIC) and JG Summit Holdings, Inc. have struck a deal to jointly bid for a multibillion-peso private-partnership project to expand and operate Mactan-Cebu International Airport, both firms said on Monday.
“MPIC and JG Summit today signed a memorandum of agreement to form an exclusive strategic partnership to jointly pursue and bid for the P17.5 billion Mactan-Cebu International Airport Passenger Terminal Project,” the statement dated Feb. 22 read.
The joint venture called MPIC-JGS Airport Consortium, Inc. will be controlled by MPIC, with JG Summit owning 33% while a still unidentified airport operator having 10% stake.
The ownership structure comes as bidding rules limit to 33% the allowed stake of a company with interests in airlines. JG Summit, controls Cebu Air, Inc., the operator of budget carrier Cebu Pacific.
MPIC and Gokongwei-led JG Summit, two of the country’s largest conglomerates, have a combined market capitalization of over P398 billion, according to the statement.
It added the team-up would merge MPIC’s capability in infrastructure development such as water utilities and electricity distribution and JG Summit’s expertise in real estate, property development and air transportation.
The heads of both companies were pleased with the development. “Integrating both our management expertise, corporate governance adherence and solid track record in developing large-scale infrastructure projects will strengthen the capabilities of the airport in responding to the needs of both passenger and airline customers,” MPIC Chairman Manuel V. Pangilinan was quoted in the statement as saying.
JG Summit Chief Operating Officer Lance Y. Gokongwei, for his part, said: ” “Their experience in developing public infrastructure projects and in bidding for the same under the government’s current PPP system, brings great value to this partnership.”
The PPP project covers the construction of a new terminal beside the existing airport, rehabilitation of the existing facility, and the operation and maintenance of the entire airport once it has been expanded.
Aside from MPIC and JG Summit, nine other firms have also bought pre-qualification documents. The project’s prequalification has been set on March 22 while the actual bidding is on Aug. 2.
MPIC is the local unit of Hong Kong’s First Pacific Co. Ltd., which partly owns Philippine Long Distance Telephone Co. (PLDT).
Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has a minority stake in BusinessWorld.
