Korean, Malaysian firms eye Mactan-Cebu airport project

Samsung C&T and Malaysia Airports Holdings Berhad join the growing number of interested bidders in the controversial Mactan-Cebu airport terminal project

UP FOR BIDDING. The government is auctioning off the contract to expand and upgrade the country's second busiest airport. Photo taken from DOTC website

MANILA, Philippines – Samsung C&T Corp. and Malaysia Airports Holdings Berhad (MAHB) joined the list of groups interested in the P17.5-billion redevelopment of the Mactan-Cebu International Airport, the second busiest in the Philippines.

The two companies expressed their interest to participate in the auction of the contract for the airport project, and clarified some items in the Instruction to Prospective Bidders (ITPB).

Transportation Undersecretary Jose Perpetuo Lotilla answered through a special bid bulletin the companies’ queries, which focused on the P1-million non-refundable fee, purchase of bid documents with other companies and legal qualifications of a consortium member bidding for the project.

Samsung C&T, formerly known as Samsung Corp., is an engineering and construction company that employs close to 11,000 employees worldwide. It posted profits of 424 billion Korean won (US$387 million) in 2011.

MAHB develops, operates, and maintains airports, including Malaysia’s 38 domestic and international airports, Delhi International Airport, and Turkey’s Sabiha Gokcen International Airport.

Local conglomerates such as San Miguel Corp., JG Summit Holdings Inc., Ayala and Aboitiz groups, and Metro Pacifc Investments Corp. also want to bid for the Mactan-Cebu airport. Some of them are looking for foreign partners for their bids.

The airport project involves the construction of a new passenger terminal building with capacity of 8 million passengers a year, as well as the operation and maintenance of old and new facilities. The existing terminal building is only capable of handling 4.5 million passengers annually.

On Friday, February 1, the Department of Transportation and Communications (DOTC) revised the bidding guidelines to allow limited participation of airline companies in the auction following an appeal by Philippine Airlines owner San Miguel and Cebu Pacific owner JG Summit. The agency earlier banned companies holding stakes in airline operators from participating.

DOTC Secretary Joseph Emilio Abaya said the agency and the Mactan-Cebu International Airport Authority decided to revise the bid criteria under the ITPB to encourage broader participation by investors.

He said the new guidelines would also protect against potential conflict-of-interest situations through strict competition safeguards in the concession agreement.

Abaya said the new guidelines would “maintain a level playing field and allow the infusion of expertise and experience into the operation of the new terminal.”

The pre-qualification conference for the project will be held on February 13. – Rappler.com

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