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San Miguel Corporation is eyeing the skies once again, having already bought bid documents for the multibillion Ninoy Aquino International Airport (NAIA) rehabilitation project. But with the Bulacan Airport already under its belt, can San Miguel overcome ownership limits to also dominate NAIA?
Ramon Ang’s conglomerate is no stranger to airports. At the height of the pandemic, San Miguel managed to secure the franchise to build and operate the New Manila International Airport, the new international gateway set to rise in Bulacan.
But though San Miguel managed to woo lawmakers into giving it the franchise for Bulacan’s airport, its push to own NAIA may be far harder.
After all, Ang doesn’t just want a piece of the airport – he wants it all.
The biggest obstacle that San Miguel will have to overcome is the ownership limits imposed on operators of airports in the Greater Capital Region (GCR).
According to NAIA bid documents, a company that already operates a GCR airport – which includes the airports in Clark, Bulacan, and Cavite – cannot be the sole private concessionaire of the airport. If a GCR operator wants to bid for NAIA, it has to be part of a consortium, and its ownership stake must be limited to only 20%.
For San Miguel, that means it can only ever own up to 20% of NAIA since it already has the Bulacan Airport.
During the pre-bidding conference for the NAIA project, San Miguel’s delegation was heard wondering aloud why the government was putting restrictions on who could take on NAIA. Could the ownership limits be the government’s way of excluding them and “favoring” certain bidders?
Rappler also learned that San Miguel has already written a letter to the government, telling them to either remove the ownership condition, or impose the same limits on other regional airport operators, not just those in the GCR.
Why does this matter? That’s because San Miguel isn’t the only existing airport operator that also wants to make a bid for NAIA. GMR – which operates the Mactan-Cebu airport alongside Megawide – has already bought bid documents for the country’s main airport. In fact, GMR and Megawide were the two companies that came the closest to securing a contract to rehabilitate NAIA before talks ultimately failed in 2020.
If San Miguel’s request is granted, then it would put Ang’s conglomerate on equal footing with the operators of the Mactan-Cebu airport for a potential NAIA rehab bid.
Why have limits?
The government maintains that the limits are there to prevent “undue influence” being exercised by big businesses that could otherwise end up owning multiple airports and airlines.
An airport official told Rappler that the ownership restrictions also preserve competition, given that operators of GCR airports all compete for a common market – passengers flying to and from the metro. The Cebu airport, he said, “has a different market.”
Airport authorities also told Rappler that they have yet to reply to San Miguel, but that they expect to resolve the issue of ownership limits within the next few weeks after conferring with the government’s transaction advisor, the Asian Development Bank.
“Their inputs were raised,” the airport official said. “It will be discussed in the next few weeks by the bank. As long as they send official questions, like what San Miguel did, i-di-discuss naman ‘yan ng TWG ng bank (it’ll be discussed by the bank’s technical working group).”
Meanwhile, during the pre-bidding conference, Undersecretary for Aviation and Airports Roberto Lim emphasized that “there are no participants that are disqualified.”
“San Miguel is not disqualified from participating. We are encouraging them to. But we have, I think, to just as a safeguard for competition purposes, put a limit on their ownership,” Lim said.
Will the government keep its ownership limits, or will San Miguel end up owning NAIA too? – Rappler.com