Ayala eyes another big PPP project until 2016

Ayala Corp. may participate in the next “big three” public-private partnership (PPP) deals the government expects to roll out over the next 12 months as it hopes to bag at least one more major contract under the current administration, a top executive at the country’s oldest conglomerate said last week.

Ayala managing director John Eric Francia said that there was still appetite to participate in the Aquino administration’s key infrastructure program even after winning two deals while waiting for the resolution of legal challenges that have stalled the awarding of two others.

The three next big projects were so described because of their massive size, an estimated $11.7 billion in terms of project cost.

Francia said these were the $2.73-billion Laguna Expressway dike project, the $3-billion Mass Transit Loop and the $6-billion North-South Commuter Railway. The three were part of at least 18 projects the PPP Center said it would roll out before June 2015, the government announced last week.

“We hope we can do, within this administration, at least another one of these major projects,” said Francia. “We do have finite resources, be it financial or human resources.” He said the company would likely pursue these projects with domestic and foreign partners as it had done with pervious PPP deals.

He noted that domestic groups could easily absorb the first “big three” PPP projects, which Francia said were the $400-million Mactan Cebu International Airport, the $1.4-billion Light Rail Transit Cavite extension and the $800-million Cavite-Laguna Expressway.

“There is the first ‘big three,’ but these range, from a private sector investment perspective, from $500 million to $1 billion. The succeeding PPP projects, however, would require much more resources,” Francia said.

“That’s an entirely different level. That’s why we would need to do this in a consortium as we had done in the past,” Francia said. “And foreign investors really need to show up for these next big projects.”

Ayala has started on taking partners after winning the $46.7-million Daang-Hari SLEx Road Link in 2011. It won this year the $38.2-million automated fare collection system PPP for Metro Manila’s elevated railways together with partner Metro Pacific Investments Corp.

An Ayala-Metro Pacific tandem was the sole bidder for the LRT-1 extension PPP while the conglomerate and the Aboitiz group submitted the highest complying bid for the Cavite-Laguna Expressway. The awarding of both those projects was stalled pending the resolution of legal issues raised either to the Supreme Court or to President Aquino.