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Singapore’s Changi, local tycoons close to winning Clark Airport operations deal

/ 07:27 PM December 14, 2018

Clark International Airport

An alliance between Singapore’s Changi Airport and local conglomerates JG Summit Holdings Inc. and Filinvest Development Corp. moved closer to winning the long-term operations and maintenance of Clark International Airport in Pampanga province.

Transportation Secretary Arthur Tugade said on Friday that their proposal would be endorsed to the National Economic and Development Authority (NEDA) next week.

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The bidder, known as North Luzon Airport Consortium, emerged as the sole qualified group after the only other challenger, dubbed X-Droid Consortium, was disqualified.

JG Summit, owned by the Gokongwei family, has businesses in property, airlines, food and beverage, energy and banking. Filinvest, owned by the Gotianuns, is into property development, power, banking and sugar production.

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Also part of the consortium is Philippine Airport Ground Support Solutions, owned by businessman Jefferson G. Cheng.

Executives from the Bases Conversion and Development Authority (BCDA), which is implementing the project, did not respond to requests for comment on Friday.

A BCDA spokesman on Friday pointed to a video clip on their Facebook page detailing the financial bid opening proceedings late last month.

Based on details announced in the video clip, North Luzon Airport offered a revenue sharing arrangement where the government would get an 18.25 percent share. The floor amount was earlier set at 10 percent.

The BCDA is targeting to award the project, a so-called hybrid Public Private Partnership project with a 25-year concession, before the end of this year, the spokesman said.

In the interview on Friday, Tugade described North Luzon Airport as the winner. However, under the Build Operate Transfer Law, bid exercises with only one bidder will trigger a negotiated process under NEDA.

In a departure from previous PPP bids, BCDA officials did not detail the reasons for the disqualification of X-Droid, a venture that includes affiliates of Philippines Air Asia and companies owned by businessman and politician Michael Romero as well as Zest-O founder Alfredo Yao.

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Other interested bidders included Metro Pacific Investments Corp. and Megawide Construction Corp., which is part of the group that operates the Mactan Cebu International Airport, the country’s second-busiest air gateway.

Megawide did not proceed after its partner, GMR Infrastructure, one of India’s most successful airport operators, failed to meet the requirements of the BCDA. Metro Pacific also did not bid after it questioned the lack of time to prepare an offer. It also cited the BCDA’s inaction on certain “material risks.”

The BCDA released the concession agreement a week before the Nov. 9, 2018 bid deadline, which was postponed several times this year.

A Clark victory by Changi, part of the group that operates Singapore’s main air hub, among the most admired in the world, comes as it also vies to run Manila’s Ninoy Aquino International Airport.

It joined Naia Consortium, a group of seven conglomerates that includes JG Summit and Filinvest, that offered to upgrade and operate Naia to the tune of P102 billion.

The government, meanwhile, has moved to expand Clark Airport.

Last December, it awarded a contract to Megawide and GMR Infrastructure for the construction of a new passenger terminal in Clark Airport.

The project will increase the airport’s current capacity of four million passengers annually to 12 million passengers by 2020. /jpv

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