Philippines awards Mactan airport deal to Megawide-GMR

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Philippines awards Mactan airport deal to Megawide-GMR

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The Philippine Department of Transportation and Communications (DOTC) announced on Saturday the formal award of the Mactan-Cebu International Airport terminal project to the consortium formed by India's GMR Infrastructure and local contractor Megawide Construction Corporation.

The announcement released on 4 April 2014 comes after the DOTC resolved issues raised by the second highest bidder, Filinvest, over the financial capability of GMR. Filinvest also alleged there was a violation of the conflict-of-interest provision. Those issues have delayed the process by almost three months.

DOTC spokesperson, Michael Arthur Sagcal, said in a statement:

"Amidst all the noise drummed up in different forums the past few months the Department of Transportation and Communication (DOTC) has allowed nothing but the law and the country's interests to matter in awarding the project. This project should have been done at least a decade ago, so there is no more time to waste. We have resolved all issues, we are ready to defend our decision and it is now time to push forward."

The consortium will now have 20 days to complete the post-award requirements, such as the submission of an irrevocable letter of credit, and the payment of the premium amount to government through the Mactan Cebu International Airport Authority. Once the requirements are satisfied, the concession agreement will be signed by the parties, paving the way for the implementation of the project over the next 3 to 4 years.

Seven groups submitted bids for the project. Finally in December 2013 the consortium led by GMR Infrastructure and Megawide Construction Corporation submitted the lowest bid for the US$400 million airport terminal tender by offering a premium to the Government of 14.4 billion peso (US$328.2 million).

The project included the construction of a new passenger terminal with an annual capacity of 8 million, the rehabilitation of the old terminal, and the operation of the whole airport facility for 25 years. Megawide and GMR aim to build an airport terminal that can accommodate 25 million passengers a year, more than three times the government requirement.

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