Japan’s Kansai airport auction manages to attract single bidder

19 May 2015 (Last Updated May 19th, 2015 18:30)

Japan’s high–stake plan to privatise the Kansai Airport has been met with only one company expressing interest to bid for the project.

Japan's high-stake plan to privatise the Kansai Airport has been met with only one company expressing interest to bid for the project.

Financial services firm Orix is the only company to have confirmed plans to submit proposal, ten months after the bidding process for the privatisation of the airport was launched.

Orix aims to partner with French concessions and construction company Vinci.

Mitsubishi Estate and Daiwa House Industry have pulled out of the process, while several other qualified Japanese bidders are concerned about cost associated with the deal.

The price of $18bn for the debt-laden airport is discouraging companies from making a bid for the airport, reported Reuters.

The price is said to be six times that of a comparable 2013 deal for Portugal airports.

Nippon Life Insurance has pulled out of the process citing limited expertise in managing commercial facilities, but said it might still consider investing in the project.

Japan's Prime Minister Shinzo Abe had launched the airport's auction to bring in more private players and funds into public infrastructure, and use the sale proceeds to repay the country's massive debts.

The move is part of Abe's goal of tripling private sector investment in Japan's infrastructure to JPY12tnover the next decade.

The Kansai sale will also include the operating rights of the smaller Osaka International Airport for 45 years.

The airport had to extend its deadline for the project in February after facing resistance from investors. It had also agreed to ease some of its conditions if requested by interested firms.

The bidding process will end on Friday.