ENSURING CREDIBILITY AND SOUND INVESTMENT: ALLOYMTD GROUP PULLS OUT OF US$2.65 BILLION DEAL IN PHILIPPINES
• Reason for the withdrawal is due to some of the unresolved issues affecting the propriety and validity of the procurement process for the project
• The bidding must be deferred until a new administration takes over to ensure transparency and fairness
KUALA LUMPUR, 30 March 2016 – AlloyMtd Group announced that the Group via its Philippines consortium, Alloy Pavi Hanshin LLEDP (the Consortium) has withdrawn their bidding for the US$2.65 billion Laguna Lakeshore Expressway Dike project, the largest Public Private Partnership (PPP) project so far rolled out by Benigno S. Aquino’s administration.
Alloy Pavi Hanshin LLEDP Consortium, comprises AlloyMtd Group; Prime Asset Ventures, Inc.; and South Korea’s Hanshin Engineering Construction Company Ltd. The Consortium is among the top three prequalified bidders for the project.
The reasons for the withdrawal from the PPP deal, which involve an extensive 47-kilometer expressway, flood control dike and a 700-hectare land reclamation component near Taguig in Metro Manila were due to some of the unresolved issues affecting the propriety and validity of the procurement process for the project.
Commenting on the issue, Dato’ Dr Azmil Khalid, President & Chief Executive Officer of AlloyMtd Group stressed that the bidding process is risky for the Group as the only foreign bidder due to legal questions over the government’s right to turn a portion of a lake into land which would be then sold by the private sector.
“First, there was no presidential proclamation reserving the reclamation area for purposes of procurement transaction,” he explained.
“Second, the legal personality of the procuring entity is questionable. It has to be the Philippine Reclamation Authority (PRA) not the Department of Public Works and Highways (DPWH) nor Laguna Lake Development Authority (LLDA). Third, there was no prior approval or endorsement by the local government units (LGUs),” he added.
Dato’ Dr Azmil said Alloy Pavi Hanshin LLEDP is serious with the bidding process, as the Consortium has spent US$2 million in preparing a bid which they did not submit at the last minute, after the deadline passed which is on March 28, 2016. It is understood that the other groups of qualified bidders also did not submit their bids on the deadline day.
“With due respect, the Consortium strongly believes the bidding process is an illegal and unenforceable transaction unless there is a signed presidential proclamation and signed tripartite agreement between PRA, LLDA and DPWH prior to the bidding,” he added.
As such, Dato’ Dr Azmil said that it would be best for the bidding to be deferred until a new administration takes over to ensure transparency and fairness.
Laguna Lakeshore Expressway Dike project is the biggest PPP project under the current President of the Philippines. The project will provide a high-standard highway with a dike that will ease traffic flow and mitigate flooding in the western coastal communities along the Laguna Lake.
Under a 37-year build-transfer-and-operate (BTO) scheme, the private partner will finance, design, construct, operate, and maintain a 47-kilometer flood control dike with a six-lane expressway toll road on top. It also includes the construction of interchanges, bridges, floodgates, and pumps from Taguig City to Los Baños in Laguna. The winning bidder will also undertake the reclamation of some 700 hectares in Taguig and Muntinlupa.
For the record, AlloyMtd Group has a strong presence in the Philippines; having successfully built, operate and manage the 36-kilometer South Luzon Expressway (SLEX) stretching from Alabang to Santo Tomas. It is also responsible for the design, financing, construction, operation and maintenance of the Philippines’ first ever one-stop government centre called the Calabarzon Regional Government Centre (CRGC) in Laguna for 30 years. Currently, the Group is undertaking another one stop government and commercial centre in Palayan City which involves a construction and development of a 34,000 square meters property owned by the Provincial Government of Nueva Ecija. The Project is a mix of Government Offices with retail and commercial space, 2 Business Processing Outsourcing (BPO) buildings which will cater to 4,000 Call Center seats and a Business Hotel with 75 rooms surrounding a 2,500 square meters public square or Public Plaza.
AlloyMtd Group is the merger between MTD Capital Berhad and Alloy Consolidated Group, which collectively has a long established track record in civil engineering and construction, manufacturing, infrastructure development, infrastructure concessions, energy, port operations, real estate and property development, operations and maintenance.
Besides operations in the Philippines, AlloyMtd Group has international presence in Saudi Arabia, United Arab Emirates, the US, UK, Australia, Indonesia, Singapore, Sri Lanka, India, Thailand, Chile and China.
About AlloyMtd Group
AlloyMtd Group is a multinational infrastructure-based company headquartered in Kuala Lumpur, Malaysia. It is active in 15 countries with investment portfolios in properties & real estate, civil engineering & construction, manufacturing of precast related products, infrastructure concessions (ranging from tolled highways, ports to IPP), operations & maintenance.
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