BCDA okays Fil-Korean group proposal for Clark

MANILA, Philippines - The state-run Bases Conversion Development Authority (BCDA) has given its imprimatur to a proposed joint venture between Clark International Airport Corp. (CIAC) and a Filipino-Korean group for the development of Terminal 2 of the Diosdado Macapagal International Airport (DMIA) in Clark, Pampanga, sources told The STAR yesterday.

This would trigger the entry of San Miguel Corp. (SMC) as an investor into Philco Aero, the Filipino-Korean consortium that earlier submitted an unsolicited proposal to undertake the development and operation of DMIA’s second terminal at a cost of $144 million.

Philco Aero president Ricardo Penson told The STAR that they have signed an agreement with SMC whereby the latter will acquire 70 percent of Philco Aero.

“One of the conditions set by SMC for the investment is that all the necessary permits for the project are already in place. But the funds SMC will invest are ready,” he said.

He, however, added that they are open to the idea of the Manuel Pangilinan-led Metro Pacific Investments Corp. (MPIC), which has signified to CIAC its interest in building and operating Terminal 2, joining the consortium.

The BCDA specifically gave the CIAC joint venture selection committee the go-signal to prepare the terms of reference to subject the Philco Aero offer to a “Swiss challenge” as required by government rules for unsolicited proposals to undertake joint venture projects with the government.

Under a Swiss challenge, any qualified group can submit a better proposal which the proponent of the unsolicited proposal has the right to match.

Sources said if MPIC opts not to join the Philco Aero consortium, it will likely submit a proposal under the Swiss challenge.

Pangilinan earlier said he wants a more comprehensive approach toward developing Clark, which would include not only developing Terminal 2 of DMIA, but also linking it to Metro Manila via an airport express train service that will run from DMIA all the way to Buendia in Makati City.

Last Jan. 3, MPIC chairman Pangilinan met with CIAC president and CEO Victor Jose Luciano in Clark where the former said he wants accelerated talks with CIAC for the development of the new terminal as well as a modern railway system that would link Clark to Manila.

According to Luciano, Pangilinan expressed support for the development of DMIA, particularly the establishment of a world-class railway system. “He (Pangilinan) is fully supportive of the development of the DMIA. This is a welcome development for the airport that will benefit not only Clark Freeport but the rest of the country,” Luciano said.

Luciano explained that Philco Aero proposed the construction of a new passenger terminal with commercial facilities. “If you look at Heathrow, Changi and even Hong Kong, 60 percent of the revenues come from land use or non-aeronautical fees such as lease rentals and commercial spaces and the rest from landing, take-off and parking fees (aeronautical fees),” he said.

Once the new terminal is operational, he revealed that plans are to convert the old terminal into a domestic terminal or even a budget terminal.

Luciano added that plans for a third terminal will only come in once DMIA has been designated as an international gateway.

The proposed joint venture between Philco Aero and CIAC, however, faces some rough sailing.

The STAR earlier reported that government appears headed toward junking the unsolicited proposal from the Filipino-Korean consortium and instead wants to undertake a new round of bidding.

Highly-placed sources told The STAR that the Department of Transportation and Communications (DOTC) may soon accept proposals from the private sector to undertake the development of the second terminal of the Clark.

“The construction of the new terminal will still be in partnership with CIAC. But instead of entertaining unsolicited proposals, the DOTC wants solicited proposals,” a source said.

But Penson said that if the report is true, it is unclear why DOTC would want to take the solicited proposal route which would require sovereign guarantees.