Ayala passes up on bid for 5 PPP airport deals

Conglomerate waits for larger projects to be put on auction

THE COUNTRY’S oldest conglomerate Ayala Corp. is unlikely to bid for the five provincial airport projects the government has put on the auction block, preferring to wait for larger deals like Manila’s Ninoy Aquino International Airport (Naia), the country’s busiest air gateway.

John Eric Francia, CEO of Ayala unit AC Infrastructure Holdings Corp., told reporters that a bid for the Iloilo, Bacolod-Silay, Davao, Laguindingan and Bohol airport deals, rolled out last month under the public-private partnership (PPP) program, was currently not in the cards.


The regional airports are, “at this point, not a priority for us,” Francia said, citing issues of “scalability.” “We haven’t bought bid documents and we are not likely going to participate.”

Ayala had sought airport deals in the past. In 2013, it joined forces with the Aboitiz Group, Airport Development Corp. and Houston Airport System for the P17.5-billion Mactan Cebu International Airport PPP project. It lost to a consortium made up of Filipino firm Megawide Construction Corp. and India’s GMR Infrastructure.


According to Francia, the company is more keen on other PPP deals like toll roads and railways. And when the potential bidding of Naia was brought up, he said that Ayala would be keen on this project.

“In Naia, we are interested if that happens,” Francia said.

The bidding for Naia, which handles over 32 million passengers annually, is under study by the Department of Transportation and Communications (DOTC).

The department, which had identified a P15-billion budget for Naia, revealed that they were targeting to submit in the second quarter of 2015 a proposal on this to the Investment Coordination Committee of the National Economic and Development Authority.

The DOTC provided no breakdown for the Naia budget.

But some investors are wary of such a contract given the government’s plan to build a new international airport nearby to eventually replace Naia. The DOTC earlier pointed to a likely site at Sangley Point in Cavite.

The original assumption was to finish the new air gateway by 2025, according to the DOTC. But the timing will also depend on how soon the approvals are given, and when a final study by the Japan International Cooperation Agency is released.


With these plans still to be finalized, the current provincial airport PPP deals are the most immediate means for private-sector investors to gain some exposure in the country’s airport businesses.

The five projects, which have a combined volume of 8.5 million passengers, are located in provinces with large growth potential in terms of tourism. The PPP Center earlier revealed that the provincial airports have lured at least three bidders: San Miguel Corp., JG Summit Holdings of the Gokongwei group and Megawide Construction Corp.

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