Ayala, MVP bag P1.72-B PPP project

It’s a happy new year indeed for two of the country’s biggest business groups.

A consortium led by Ayala Corp. and Manuel V. Pangilinan-led Metro Pacific Investments Corp. finally bagged a P1.72-billion public private partnership (PPP) deal to develop and operate a common ticketing system for elevated railways in Metro Manila, the Department of Transportation and Communications announced Friday.

The awarding of the project, formally known as the automated fare collection system (AFCS), has been delayed for about a month mainly due to issues raised by disqualified bidder E-Trans Solutions Joint Venture.

The AFCS deal is thus the first PPP project to be awarded by the Department of Transportation and Communications, which has faced heavy criticism at the pace at which it has been rolling out projects, considered a key part of the Aquino administration’s cornerstone infrastructure program.

The DOTC said the notice of award was issued to Ayala and Metro Pacific’s AF Consortium late Thursday. Metro Pacific chief financial officer David Nicol confirmed the award separately yesterday.

PPP Center executive director Cosette Canilao said the signing of the concession agreement is expected within 20 days.

E-Trans Solutions legal counsel Conrad Tolentino said they have not been able to review their position in the wake of the awarding to Ayala-Metro Pacific.

“Based on our latest discussions [before the awarding Thursday], we will pursue all legal remedies,” Toletino said.

The AFCS aims to provide a “tap and go” system for the Light Rail Transit (LRT) Lines 1 and 2 and the Metro Rail Transit (MRT) Line 3 by September 2015. The winning bidder will operate the system for a period of 10 years.

In its statement, the DOTC said it would be able to implement the common ticketing system and generate revenues for the government at the same time, without passing any cost to passengers.

This was made possible by the way the DOTC structured the project, which allows the winning concessionaire to expand its business beyond the LRT and MRT lines. Thus, the AF Consortium will be able to promote the use of the smart card-based technology to other transport modes such as buses as well to retail outlets such as mall and convenience stores, among others.

The DOTC opened three financial proposals—AF Consortium, SM Group and Comworks-Berjaya—for the AFCS last Dec. 9 after two other groups, E-Trans Solutions and Megawide-Suyen-Eurolink Consortium, were disqualified during the technical evaluation stage. E-Trans later filed a motion for reconsideration, saying its proposal should be considered.

AF Consortium submitted the best offer through a premium bid of P1,088,103,900 against SM’s premium  bid of P1.088 billion—a difference of P103,900 or 0.01 percent.

The premium will be paid to the government to operate the system over the 10-year concession period.

Comworks-Berjaya, meanwhile, sought a subsidy of P2.05 billion.

The AFCS deal, the second PPP project of Ayala and a first for Metro Pacific, brings to six the number of PPP deals awarded by the Aquino administration. The other five are the Daang Hari-South Luzon Expressway link road (Ayala consortium), the Naia Expressway Phase II (San Miguel group), two classroom building projects and the upgrade of the Philippine Orthopedic Center, all bagged by Megawide Construction Corp.