PRESIDENT Aquino has ordered the Department of Public Works and Highways (DPWH) to conduct another bidding for the P35.42-billion Cavite-Laguna Expressway (Calax) project, despite a warning from business groups that this move could tinge the formidable name of the administration’s key infrastructure program.
A document obtained by the BusinessMirror showed the DPWH and its Special Bids and Awards Committee (SBAC) were directed to sort out the details of the rebidding for the much-coveted expressway-construction contract.
The decision of Malacañang partially grants the petition of San Miguel Corp. (SMC) unit Optimal Infrastructure Development Inc. to set aside its disqualification from the auction.
However, the President did not approve its other appeal to reconsider the firm’s alleged P20.1-billion premium offer.
“The appeal is partially granted. Accordingly, the SBAC resolution is hereby set aside and the DPWH or SBAC is directed to conduct a rebidding,” the document read, referring to the decision of the agency to disqualify Optimal from the deal’s auction.
The infrastructure arm of the diversified conglomerate SMC pleaded before Malacañang in June to accept its bid by way of judicial notice.
However, Malacañang argued that awarding the deal to Optimal, by way of judicial notice, cannot be granted.
The order of the President also provided for the dismissal of the motion of Team Orion that urged Mr. Aquino to award the deal to either party.
DPWH Public-Private Partnership (PPP) Officer-in-Charge Ariel C. Angles said his agency has yet to discuss the final details of the rebidding.
“We haven’t discussed it. But we will be meeting next week to discuss the bid parameters, the target dates and the draft concession agreement,” he told the BusinessMirror.
A source familiar to the matter commented that Mr. Aquino decided to rebid the expressway deal due to the disparity between the two groups’ premium offers.
“The President finds the P8-billion difference as wasteful,” the ranking government official said. “He wants to get a more economically sound offer.”
Team Orion of Ayala Corp. and Aboitiz Land Inc. emerged as the front-runner during the auction, having submitted an P11.66-billion premium to win the deal.
Now that the deal is subject to a fresh bidding, the government expects to receive higher premiums, given the need of other groups to match the P20.1-billion disqualified offer of Optimal.
The food-to-infrastructure firm’s unit was disqualified from the bidding after its proposal failed the technical evaluation due to a defective bid security.
Business groups, led by the Makati Business Club, earlier warned President Aquino that his PPP program’s good name may lose its credibility due to inconsistencies in rules and a violation of the law.
But the Philippine Chamber of Commerce and Industry (PCCI), the largest business group in the Philippines, backed Mr. Aquino’s decision, as this would maximize the economic benefits of the state from the bidding.
PCCI President Alfredo M. Yao said the government stands to gain at least P8.45 billion more from the fresh tender, as premium bids to build the thoroughfare would start from the floor price of P20.1 billion.
The project is a 47-kilometer thoroughfare that would start from the Manila-Cavite Expressway in Kawit, Cavite, and end at the South Luzon Expressway (Slex)-Mamplasan Interchange in Biñan, Laguna. It would consist of nine interchanges and a toll barrier before the Slex.
The third PPP project under the DPWH, the expressway is seen to decongest the traffic along the Cavite-Laguna road network.
The construction of the multibillion-peso expressway is seen to start by October next year and expected to be completed in September 2017.
The government has awarded eight contracts since the infrastracture program’s inception in 2010.