Philippine infrastructure

Megawide denies NAIA rehab proposal junked

Aika Rey

NAIA. The facade of the Ninoy Aquino International Airport Terminal 1.

File photo by Angie de Silva/Rappler

With its partner GMR Infrastructure Limited, Megawide Construction Corporation maintains it can 'deliver a first-world NAIA'

Megawide Construction Corporation on Monday, November 23, denied a report that the government has junked its P109-billion unsolicited proposal to rehabilitate the Ninoy Aquino International Airport (NAIA).

The Bilyonaryo website reported earlier on Monday that the National Economic and Development Authority (NEDA) Board’s Investment Coordination Committee-Cabinet Committee (ICC-CabCom), in a November 19 letter, already rejected Megawide’s unsolicited proposal over insufficient equity.

Megawide said the report is “false,” adding that it has “yet to receive any official communication from the government” on the matter.

The joint venture of Megawide and its Indian partner GMR Infrastructure Limited currently holds the original proponent status for the NAIA rehabilitation project. The government’s talks with another consortium made up of the Philippines’ top conglomerates previously collapsed.

The November 19 NEDA ICC-CabCom letter, signed by Finance Secretary Carlos Dominguez III and NEDA Acting Secretary Karl Chua, states that the documents for the proposal would be returned to the Department of Transportation as the secretariat found that Megawide’s equity position “is insufficient to finance the equity requirement for the proposed project.”

Megawide, quoting the same letter, said on Monday that the government only asked for the complete requirements for the project.

“[The letter]…dated 19 November 2020, merely asked for the full submission of the requirements from the Megawide-GMR consortium to demonstrate capabilities to deliver a first-world NAIA,” said Megawide.

Megawide clarified that it was able to submit the needed financial documents to the Manila International Airport Authority last Friday, November 20, a day after the letter was issued to Transportation Secretary Arthur Tugade.

“Under the new arrangement, Megawide will have majority stake at 60% while GMR has agreed to provide 40% of the equity requirement for the project. GMR brings to the table sufficient financial bandwidth and unparalleled global airport operations experience,” Megawide said.

In a disclosure to the local bourse, Megawide said it “looks forward to leveraging” GMR and Groupe ADP’s partnership for the transformation of NAIA.

French airport operator Groupe ADP completed the acquisition of a 49% stake in GMR this year.

“The financial documents we submitted are sufficient to exclusively support the requirements of the NAIA project. With this, we are hopeful our proposal to rehabilitate and transform NAIA into a first-world airport complex can now be elevated to the Cabinet committee for approval and proceed to Swiss challenge,” said Megawide managing director for transport Louie Ferrer.

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Megawide earlier said that once the NEDA Board gives its approval, a Swiss challenge can take place in the 1st quarter of 2021, when other firms can make competing offers.

Being the original proponent, Megawide-GMR has the right to match competing offers during the Swiss challenge.

Megawide shares dipped by 2.45% on Monday, closing at P10.34 apiece. – Rappler.com

Aika Rey

Aika Rey is a business reporter for Rappler. She covered the Senate of the Philippines before fully diving into numbers and companies. Got tips? Find her on Twitter at @reyaika or shoot her an email at aika.rey@rappler.com.