After three decades, the Department of Transportation on Friday finally awarded the P171-billion contract to rehabilitate, operate and maintain the Ninoy Aquino International Airport (NAIA) to a group led by San Miguel Corp.
“We are pleased to announce that we will award this project to the winning bidder—the SMC-SAP Group,” Transportation Secretary Jaime Bautista said in a press briefing.
Bautista said the DOTr issued the notice of award to the SMC-SAP Company Consortium.
The NAIA privatization is three decades and six administrations in the making, starting from the PIATCO-Fraport attempt during the Ramos administration.
The awarding of the contract marks the beginning of a 25-yeartransformation for one of the country’s busiest airports, aiming to generate a staggering P900 billion in revenues throughout the concession period.
The SMC-SAP Group, which was formed by San Miguel Holdings Corp., RMM Asian Logistics Inc., RLW Aviation Development Inc. and IncheonInternational Airport Corp., had offered the highest bid of 82.16percent revenue share to the government at the opening of financial proposals for NAIA.
Under the terms of reference, the percentage revenue share to the government is the main bid parameter for the auction.
The winning bidder will also pay P30 billion upfront cost and annual annuity payment of P2 billion to the government.
Transportation Undersecretary and chairman of the Pre-qualification Bids and Awards Committee Timothy John Batan said the San Miguel Groupis mobilizing at least P88 billion in capital investments within its first six years and at least P122.3 billion in capital investments for its entire 25-year concession period.
In comparison, Batan said total capital outlay for NAIA from thebudget of Manila International Airport Authority (MIAA) from 2010 to2023 was only P27.09 billion.
In a statement, San Miguel said its proposal is designed not only to elevate NAIA to world-class standard 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-germ sustainability,” San Miguel said.
The other two bidders that submitted financial bids were Manila International Airport Consortium, which is composed of Aboitiz InfraCapital, Ayala’s AC Infrastructure Holdings Corp., Alliance Global-Infracorp, Filinvest and JG Summit Holdings (25.91 percent), and GMR Airports International B.V., Cavitex Holdings, Inc. and House of Investments, Inc. of GMR Airports Consortium (33.3 percent).
Asian Airport Consortium was disqualified to join the bidding process by the Pre-qualifications, Bids and Awards Committee (PBAC) because it failed to comply with the technical proposals for NAIA.
The winning bidder will have until March 6 to submit the post-award requirements.
The DOTr expects to sign the concession agreement with the winning bidder on March 15, with the turnover of the facility likely in September this year.
It will serve as co-grantors for the project with MIAA, which would have a 15-year concession period and an option for a 10-year extension.