Megawide-GMR may bag P17.5B PPP deal

The consortium of Megawide Construction Corp. and India’s GMR Infrastructure Ltd. is the frontrunner for a P17.5-billion deal to operate and expand Mactan Cebu International Airport, the country’s second-busiest air facility. INQUIRER.net FILE PHOTO

The consortium of Megawide Construction Corp. and India’s GMR Infrastructure Ltd. is the frontrunner for a P17.5-billion deal to operate and expand Mactan Cebu International Airport, the country’s second-busiest air facility.

The consortium is ahead of other major conglomerates after it made an up-front offer said to be the highest for any public-private partnership (PPP) deal on record, according to results of the opening of the financial bids submitted by seven groups.

If the two companies were to succeed in clinching the deal, it would be the third PPP project for Megawide and the fourth airport contract for GMR, whose portfolio includes Delhi International Airport.

GMR remains unbeaten when it comes to airport project auctions.

The contract will be awarded as soon as the Department of Transportation and Communications winds up its final review in January.

The Megawide-GMR group offered P14.4 billion for the contract, which comes on top of the project cost. All groups, which included conglomerates like Ayala Corp., San Miguel Corp., SM Group and Metro Pacific Investments Corp., submitted premium offers.

Megawide-GMR’s bid was P400 million higher than that of the Filinvest group, which partnered with Singapore’s Changi.

The SM group’s Premier Airports offered P12.5 billion. The MPIC-JGS Airport consortium—a partnership between Metro Pacific of businessman Manuel Pangilinan and JG Summit Holdings of the Gokongwei family—offered P11.23 billion. AAA Consortium, led by the Ayala and Aboitiz groups, offered P11.08 billion. The group of San Miguel and Incheon submitted a P9.05-billion offer, while that of the Lopez clan’s First Philippine Airports offered P4.7 billion.

“We always say we’re like David versus Goliath,” Megawide chief financial officer Oliver Tan said, comparing the company to its bigger opponents. The winning bidder will operate Mactan-Cebu Airport for 25 years.

“It exceeded our expectations, those were good bids. The government was prepared to give a subsidy,” Cosette Canilao, executive director of the PPP Center, said after the bids were opened. “We got good operators from all over the world to participate. It’s good for the government.”