Financial close for Cebu airport PPP project

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Financial close for Cebu airport PPP project

The consortium formed by India's GMR Infrastructure and Megawide Construction Corporation has raised P23 billion (US$514.5 million) worth of syndicated bank loans to finance the Mactan-Cebu International Airport terminal project.

The banks that have provided financing for the airport PPP project are the following:

  • BDO Unibank Inc.,
  • Bank of the Philippine Islands,
  • Development Bank of the Philippines,
  • Land Bank of the Philippines,
  • Metropolitan Bank & Trust Co. and
  • Philippine National Bank.

BDO Unibank Inc.-Trust and Investments Group has acted as the facility agent and security trustee for the transaction and BDO Capital has acted as the lead arranger.

On 22 April 2014 the Philippine Department of Transportation and Communications (DOTC) and the winning consortium signed the project contract. The team offered the lowest bid for the airport terminal tender by offering a concession premium to the Government of 14.4 billion peso (US$322.1 million).

The project included the construction of a new passenger terminal 2 with an annual capacity of 8 million. The new terminal 2 will have three levels with a double sided pier spread over 43,398 m² with six contact gates to service 90% of international flights through boarding bridges, three-level in-line baggage screening system, four baggage carousels, 14 escalators and canopy coverage for airport village, ramps and taxi parking.

The project also involves the rehabilitation of the passenger terminal 1, 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.

Construction of the airport is expected to start on January 2015.

The total passenger volume at Mactan-Cebu International Airport  is expected to increase to 12.5 million by 2018 form the current level of 4.5 million.

Two weeks ago we reported that the government of Philippines, through DOTC, had launched a tender process to development, operation and maintenance of six airports under a single PPP contracr with an estimated investment of P113.42 billion (US$2,533 million).

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