Ayala to rejoin MPIC-led group for Manila-Cavite rail project

Conglomerate Ayala Corp. is set to rejoin a consortium it withdrew from last year for the P65-billion Manila-Cavite railway extension public private partnership deal, which is up for re-bidding, after the terms were improved by the government, a company official said Thursday.

The transportation department, in a separate statement, reiterated that there were six groups, including the four original bidders, keen on the Light Rail Transit Line 1 (LRT-1) Cavite Extension.

It also expressed confidence that all major issues had already been resolved as the government moved to restructure the original PPP terms, which the private sector said made the project unfeasible.

The auction held in August failed after three participants, DMCI Holdings, MTD- Samsung and San Miguel Corp. withdrew their bids while a fourth group, Light Rail Manila Consortium, composed of Metro Pacific Investments Corp. minus Ayala Corp., submitted a noncompliant offer.

The Department of Transportation and Communications said in its statement that Ayala was rejoining Light Rail Manila, which Ayala managing director John Eric Francia confirmed.

“We are finalizing arrangements. Our intent is to keep the consortium,” Francia said.

Also participating are MTD Philippines, DMCI and San Miguel while new players are Globalvia Inversiones of Spain and Megawide Construction Corp., the department added.

“No major issues have been raised by the bidders, although updates on the project were sought,” it said.

Sought for comment, Francia said the new terms  were  “better than the last bid structure and should have a better chance of success.”

Among the more contentious issues in the previous bidding terms had to do with the progress of the government’s right-of-way acquisition for the project.

During the prebid conference conducted on Monday, the transport agency said the government had already completed 92.34 percent of the right-of-way acquisition requirement for the Baclaran-Dr. Santos segment; 69.2 percent of the Dr. Santos-Zapote and 84.2 percent of the Zapote-Niog segments.

Other revised terms involve the government absorbing the obligation to pay real property taxes, ensuring the integrity of the facility’s structure for a two-year period, permitting a 5-percent fare increase upon completion of the project and allowing the submission of negative bids.

The changes were approved by President Aquino in a National Economic Development Authority board meeting on Nov. 21, 2013.

“These developments signify confidence in the improved terms of the project.  We look forward to more groups joining the bid,” said Michael Arthur Sagcal, a spokesperson for the transportation department.