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Sale of Mimosa leisure complex hits snag

Posted on 09:41 PM, June 29, 2010 [ BusinessWorld Online ]

THE LONG-awaited privatization of a casino-resort at Clark free port has again hit a snag, this time as the South Korean consortium Hanwool I&D being considered for the contract is being investigated.
Plans to lease out the Mimosa Leisure Estate within the year may thus be delayed although the state agency in charge said it was not in a hurry to complete the auction, an official told BusinessWorld in a chance interview last week.
“We were at the post-qualification stage,” Clark Development Corp. (CDC) Assistant Vice-President Bernardo F. Angeles, Jr. said, referring to the process before the contract for the resort’s lease and management is awarded.
“But we are now validating concerns over one of the members of the Korean consortium,” Mr. Angeles said, declining to elaborate.
Back in December 2009, the state agency had accepted the unsolicited bid of Hanwool I&D -- a joint venture among a resort developer, a pharmaceutical firm, and a venture capitalist.
The member of the consortium are: Kangwon Land, Inc., Daewoong Pharmaceutical Co. Ltd., and I&D Venture Investment Co. Ltd.
CDC then opened the auction to a “Swiss Challenge”, a process in which other bidders are invited to submit counterproposals.
Hanwool I&D, however, edged out the competition when it matched the highest counterbid, Mr. Angeles said, without citing specifics. CDC went on to check the Korean consortium’s proposal one last time before the contract’s awarding. It was at this point that the process stalled, Mr. Angeles said.
“It’s okay if it results in a failed bidding. We’re not in a hurry. It has taken long in past biddings anyway,” Mr. Angeles said in Filipino.
The 215-hectare property has been on the auction block after three failed attempts to sell it since 2003. In 2008, CDC came close to awarding the property but voided a contract with bid winner Waterfront Philippines, Inc. when the firm, unable to secure a casino operation license, did not pay on time. Waterfront Philippines would have paid P1.5 billion for the property according to its 2008 contract. -- Jessica Anne D. Hermosa
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