[ bworldonline.com ]
In a disclosure to the stock exchange on Thursday, the Antonio L. Tiu-led firm said it entered a memorandum of agreement (MoA) with the Chinese firm. The two companies target to complete the due diligence process by May 31 before its execution of the investment agreement.
“The Company… has executed a binding MoA with CCECC, a 100% owned subsidiary of China Railway Construction Corp., in connection with the Makati City Subway PPP (public-private partnership) Project of the Company,” it said.
The MoA indicated CCECC will invest $300 million to $350 million in Philippine Infradev or its subsidiary; and undertake the engineering, procurement and construction works for the Makati Subway Project.
It will also “provide completion performance guarantee for the completion of the Makati Subway Project… subject to, among others, the completion of a financial, legal and technical due diligence.”
Last December, Philippine Infradev started preparatory works on the Makati Subway Project, which aims to build a 10-kilometer intracity railway system in the business district.
The Makati City government awarded the project to the consortium of Philippine Infradev and Chinese firms Greenland Holdings Group, Jiangsu Provincial Construction Group Co. Ltd., Holdings Ltd. and China Harbour Engineering Company Ltd. The 30-year concession agreement is scheduled to be signed this year.
The railway is targeted to open by 2025, and will connect Ayala Avenue to Ospital ng Makati through an underground mass transport system. It is expected to benefit around 700,000 passengers every day.
Shares in Philippine Infradev jumped 8% or 18 centavos to close at P2.42 each. — Denise A. Valdez
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