PPP finally gets rolling with P1.96B road project

The Ayala and San Miguel groups are vying for the P1.96-billion Daang Hari-South Luzon Expressway link toll road, the very first infrastructure project to be auctioned by the Aquino administration under the public-private partnership (PPP) framework.

The two conglomerates participated with their respective foreign partners during the bidding conducted by the Department of Public Works and Highways last Monday for Daang Hari, a four-kilometer, four-lane paved toll road that will pass through the New Bilibid Prison reservation and connect the town of Bacoor in Cavite to the SLEx through Susana Heights.

Al Vitangcol III, director of the PPP Center—an observer during the contract bidding—confirmed that Ayala and San Miguel were the only two parties that submitted bids. The PPP official added that another prequalified bidder, Consunji-led construction firm DMCI Holdings, backed out of the bidding, but he declined to give details.

Industry sources said Ayala Corp. submitted a bid in partnership with Spanish group Getinsa Ingineieria while San Miguel Corp. teamed up with tollroad operators Citra Lamtoro Gung Persada and Star Tollway Corp.

The government will pick the better offer with the goal of immediately getting compensation for its initial expenses on the project. The floor price for the takeout of the government’s interest was set at P370 million before the value-added tax.

The winning bidder will invest between P1.5 billion and P1.7 billion to complete the toll road and operate it under a 30-year concession.

The government is doing the evaluation of the technical proposal and is expected to open the financial bids within the week.

Some potential investors were initially lukewarm on the Daang Hari bidding but industry sources said the DPWH had since then improved the terms of the toll road concession. What was seen crucial for investors to make a decent return from the project was to involve the Tollway Regulatory Board in the process.