Group asks SC: Stop takeover

CEBU, Philippines - A group of businessmen filed a petition with the Supreme Court on Monday to stop the GMR-Megawide Corporation’s takeover of the Mactan-Cebu International Airport citing “unstable financial reasons.”

Led by their president Medardo Deacosta Jr., the Business for Progress Movement, a non-profit group, claimed that GMR-Megawide group has “no financial capacity to undertake the rehabilitation and expansion of the MCIA.”

“We have not received a copy of the petition,” said Engineer Nigel Paul Villarete, General Manager of Mactan Cebu International Airport yesterday.

Villarete also said that he is not familiar with the business group or Deacosta.

Since GMR-Megawide is a partnership between Megawide Construction Corp. and Bangalore-based GMR Infrastructure Ltd., BPM said that their partnership had led to the increase of the Passenger Service Charge or terminal fee of the general public.

Starting November 1, the MCIAA increased the Domestic Passenger Service Charge from P200 to P220 and the International Passenger Service Charge from P550 to P750.

The MCIAA Board approved the revision of the PSC last October 14. The MCIAA earlier also said that the increase will help in funding new investments to cater to the expanding airline and passenger traffic.

According to the petition of BPM the increase put in serious doubt the financial capability of GMR-Megawide to commence the rehabilitation and expansion project of the MCIA.

“Since [GMR-Mega-wide]  has no financial capacity to start the rehabilitation of MCIA, both [DOTC and GMR-Megawide] had come up with the scheme of imposing an increased rate of terminal fees to cover the operating costs and expansion of the project,” their petition read.

The group also asked for a temporary restraining order, as well as the writ of preliminary injunction from the SC.

BPM claimed that GMR Infrastructure alone, was in a “debt-ridden” state, according to the recent international business reports.

The petitioner said a company with unstable financial requirements should not be allowed or granted to undertake an important public project.

Raising funds, through asset sale, equity issue and the diversion of few road and power plants are some ways of the GMR to pay its corporate debts, BPM said.

They also said a private equity firm from the United States has agreed to provide about $175 million in financing the GMR through debt equity.

The group also mentioned the cancellation of GMR’s contact with the government of Maldives for the modernization of the Male Ibrahim Nasir International Airport which “greatly affected GMR’s revenues coming from airport business.”

“There appears a clear and present danger that the instant petition...will be rendered nugatory and ineffectual, and that the highest interest of justice will not be served if [the] act complained of – that is, the immediate turnover of the operations MCIA to [GMR-Megawide] would not be enjoined,” the petition read.

GMR-Megawide Cebu Airport Corp. also said they have not received a copy of the petition.

“We havent received petition yet. But I have asked our legal team to check this out. We will abide by the law and let the law take its course. For now we continue what we have started at the airport. And we will provide the best service for Cebu,” said GMRCAC President Louie Ferrer in an official statement.

The consortium’s bid for the project was P14.40 billion.  —/BRP (FREEMAN)