Megawide-GMR remits P16.1-B payment for Cebu airport project

MANILA, Philippines - The tandem of Filipino-owned Megawide Construction Corp. and Bangalore-based GMR Infrastructure remitted yesterday to the goverment  the P16.1 billion paymentfor the country’s first airport public private partnership (PPP) project.

The remittance of the premium payment paved the way for the signing of the concession agreement between the Department of Transportation and Communications (DOTC) and the Megawide-GMR Group yesterday.

DOTC undersecretary Jose Perpetuo Lotilla, GMR Infrastructure Airports chairman Srinivas Bommidala, and Megawide chairman and chief executive officer Machael Cosiquien

led the signing of the concession agreement for the P17.5 billion Mactan Cebu international airport expansion project.

Cosiquien said in an interview with reporters after the hastily called signing ceremony that the tandem yesterday paid P16.1 billion to the Mactan Cebu International Airport Authority (MCIAA) including the P14.4 billion premium payment as well as P1.7 billion value added tax (VAT).

He said the joint venture that is 60 percent owned by Megawide and 40 percent owned by the GMR Group contributed 30 percent of the total initial payment while BDO Unibank extended a loan to finance the 70 percent.

He pointed out that the company is spending P17.5 billion for the construction of a new passenger terminal building starting January or February next year.

According to him, the joint venture is also looking at developing another six-hectare property within the country’s second busiest airport into a mixed-use commercial area that would include a hotel, shopping malls, among others.

Cosiquien said the tandem is talking to several international lenders including the World Bank (WB) as well as the Asian Development Bank (ADB) to finance the PPP project.

He explained that the DOTC and MCIAA would turn over the operation and maintenance of the country’s second busiest airport to the Megawide – GMR tandem in October.

The new passenger terminal building dedicated for international flights would be completed by January 2018 paving the way for the renovation of the existing terminal.

Bommidala said the signing of the project would boost bilateral ties between the Philippines and India.

“This is the largest investment between an Indian and a Filipino company in the Philippines’ largest privatization program, and I am happy to be part of this,” he stressed.