Investors still interested in PPP

Foreign investors continue to show interest in the government’s public private partnership (PPP) infrastructure program, easing concerns these would be turned off by President Aquino’s recent decision to resolve a row over the Cavite Laguna Expressway project by way of a rebid.

The latest sign that investors are willing to absorb unforeseen risks as long as a project can make money came as the Department of Public Works and Highways (DPWH) on Friday said two more groups had acquired qualification documents for the P123-billion Laguna Lakeshore Expressway Dike project.

This means 24 groups, including some of the Philippines’s biggest conglomerates, have purchased bid documents for the Laguna Lakeshore deal, the largest PPP deal to be rolled out thus far, according to Ariel Angeles, head of PPP Service of the DPWH.

In particular, a document from the department showed that a consortium called Rainbow Holdings, which is comprised of Filipino, Korean and Indonesian parties, acquired qualification documents for the Laguna Lakeshore deal last Nov. 24, just days after President Aquino issued the Calax rebid order on Nov. 19.

Last Oct. 7, Filipino company Mega Express Road and Development Corp. acquired bid documents.

Rafael Yabut, DPWH undersecretary and chair of its special bids and awards committee, said in an interview last week that the interest in Laguna Lakeshore was early proof that investors still wanted to park their money in the Philippines, which is in dire need of infrastructure improvements to support economic expansion.

The purchase of pre-qualification documents was not a guarantee that a company would submit a bid for Laguna Lakeshore on July 6 next year, but it indicated interest in the project, he said.

The government would get a better idea on how to proceed on Dec. 2, which has been set as the next pre-qualification conference for the project, whose main feature is a 47-kilometer tollroad running from Taguig in Metro Manila to Los Baños, Laguna, and a flood-control dike.

To make the deal more attractive, the government included a reclamation component involving 700 hectares of land in Laguna lake near Taguig and Muntinlupa “for mixed-use” developments.

So far, the DPWH has given interested groups until Jan. 14 next year to prepare and submit pre-qualification requirements. The original date was Oct. 16, 2014, but the extra time was given because of the size and complexity of the deal, Public Works Secretary Rogelio Singson said previously.

Information from the DPWH showed that major Philippine and foreign groups have already bought bid documents for the Laguna Lakeshore deal.

These included Ayala Corp., San Miguel Corp., Metro Pacific Investments Corp., Malaysia’s MTD Group, JG Summit Holdings, Aboitiz Equity Ventures, Megaworld Corp., LT Group Inc., GT Capital Holdings, Filinvest Land, Megawide Construction Corp., France’s Egis Projects S. A. and Macquarie Securities (Phil.) Inc.

The government, through the PPP Center, has been busy marketing more than 50 projects in its pipeline valued at about $20 billion in a recent string of international roadshows in Australia, North America, Japan, Europe and Singapore.

The government has awarded eight PPP deals so far, the largest being the P65-billion Light Rail Transit Line 1 extension to Cavite province, which was won by a consortium led by Filipino conglomerates Metro Pacific Investments Corp. and Ayala Corp.