Megawide rescinds Philippine PPP project

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Megawide rescinds Philippine PPP project

Megawide Construction Corp. has terminated its contract with the government for the new Philippine Orthopedic Center (POC) PPP project.

On 17 November, in a disclosure to the stock exchange, Megawide announced that its subsidiary Megawide World Citi Consortium Inc. (MWCCI) has served a Notice of Termination of the build, operate, and transfer (BOT) agreement to the Philippine Department of Health (DOH). The agreement was signed in March 2014. MWCCI reported in the statement:

"Megawide has terminated the contract for the modernization of the Philippine Orthopedic Center with the Department of Health. This is a decision driven by the two-year delay in awarding of the certificate of possession, among others, and not one that was made lightly."

"Despite difficulties, it is a project that we continue to believe in. We continue to support the DOH and this administration in their vision for inclusive healthcare for all Filipinos."

The Philippine consortium formed by Megawide Construction Corp. and World Citi Inc. was declared the winner for the new POC PPP project on 11 December 2013. The consortium was the only bidder in the tender process. It bid P5.672 billion (US$119.9 million) for the project.

The POC project involves the increase in bed capacity from the current 300 beds to 700 beds. It included the design, build, finance, operation and maintenance of the facility for a period of 25 years.

In early february 2014 we published that Employees of the Philippine Orthopedic hospital and other social and health groups asked the Philippine Supreme Court (SC) to stop the construction of the new project under the PPP model. They said the government has abandoned its duty to provide and ensure a basic social service such as health to private entity at the expense of the poor and underprivileged

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