SMC-SAP consortium bags NAIA rehab deal
‘The group which includes Incheon-Seoul International Airport Corp, submitted the highest bid amount, offering to share 82.16 percent of future gross revenues, excluding passenger service charges, with the government.’
A consortium led by tycoon Ramon S. Ang’s San Miguel Corp. is taking on the rehabilitation of the already congested Ninoy Aquino International Airport, or NAIA.
This P170.6-billion project seeks to transform and modernize the main air hub, aiming to significantly enhance passengers’ travel experience.
Transportation Secretary Jaime J. Bautista formally declared SMC-SAP Company Consortium as the winning bidder at a press briefing on Friday immediately after its issuance of a Notice of Award.
The SMC-SAP and Company Consortium is composed of diversified conglomerates San Miguel Holdings, Corp., Rmm Asian Logistics Inc., Rlw Aviation Development Inc., and Incheon International Airport Corp., the developer of the world-class South Korean air hub.
The group submitted the highest bid amount, offering to share 82.16 percent of future gross revenues, excluding passenger service charges, with the government.
This is in addition to the fixed upfront fee of P 30 billion and annual fee of P 2 billion, both payable to the government.
Ready to kickstart the project
In a press statement, the SMC SAP and Co. consortium signified its readiness to kickstart the NAIA project, which it said went through a “fair and comprehensive bidding process.”
“Our proposal is designed not only to elevate NAIA to world-class standards but also to ensure that the government benefits from the most advantageous revenue-sharing agreement. This aims to secure a favorable outcome for our shareholders while prioritizing fairness and long-term sustainability over immediate profits,” the company said.
“Recognizing the weight of the responsibility entrusted to us, we are committed to collaborating closely with the government and our various stakeholders, harnessing every resource available to us, to transform NAIA into a modern international gateway that Filipinos will be proud of,” it added.
The turnover of operatorship to the private sector will take place in September, provided the timeline is followed.
Employees of the Manila International Airport Authority, or MIAA has been assured by the DoTr that their jobs will not be affected by the turnover.
The post-award requirements are expected to be completed by March while the Concession Agreement is expected to be signed on the same month likewise.
Fair, transparent privatization process
In a recent interview, Transportation Secretary Jaime J. Bautista vowed that the privatization process will be transparent and fair, and that all stakeholders, including MIAA employees, are consulted and their concerns are addressed.
Presently, the DoTr is working with the MIAA to develop a transition plan that will ensure the smooth and orderly transfer of operations to the private sector.
Rehabilitating NAIA to improve the efficiency and quality of its services as the country’s main international airport is a key priority of the current administration.
During the bid opening last 27 December 2023, the Bids and Awards Committee of the DoTr revealed that four groups submitted their respective bids, namely, Manila International Airport Consortium or MIAC, Asian Airport Consortium, GMR Airports Consortium, SMC-SAP and Company Consortium.
The MIAC was composed of Gip Em Miac Pte. Ltd., Aboitiz InfraCapital, Inc., Ac Infrastructure Holdings Corp., Alliance Global Infracorp Dev’t, Inc., Asia’s Emerging Dragon Corp., Filinvest Dev’t Corp., And JG Summit Infrastructure Holdings Corp. All members are among the country’s leading infrastructure builders.
GMR Consortium, on the other hand, is composed of three companies: India-based GMR Airports International B.V.; Cavitex Holdings Inc., a unit of Metro Pacific Investments Corp.; and House Of Investments Inc. wholly owned by Landev Corp.
Meanwhile, the Asian Infrastructure And Management Corp., Cosco Capital Inc., Philippine Skylanders Int’l Inc., and Pt Angkasa Pura II made up the Asian Airport Consortium.
The NAIA project will cover all facilities of the airport, including its runways, four terminals, and associated facilities. This PPP Project is expected to improve the overall passenger experience and service quality at the NAIA.