Philippines Supreme Court upholds award of Mactan-Cebu airport project to GMR consortium

2 February 2016 (Last Updated February 2nd, 2016 18:30)

The Supreme Court (SC) of the Philippines has upheld the decision of awarding the Mactan-Cebu International Airport expansion and modernisation project contract to GMR Infrastructure and Megawide Construction Corporation (MCC) consortium.

The Supreme Court (SC) of the Philippines has upheld the decision of awarding the Mactan-Cebu International Airport expansion and modernisation project contract to GMR Infrastructure and Megawide Construction Corporation (MCC) consortium.

The Southeast Asian country's apex court has supported the decision of the Department of Transportation and Communications (DoTC) to award the contract and is expected to boost GMR Infra's business prospects in the country.

Citing that the case has no merit, the Chief Justice of Philippines has squashed the April 2014 petition by Senator to stop awarding the contract.

"It clears any confusion or misconception about the process of airport modernisation."

It also denied the separate petition by the Business for Progress Movement due to lack of legal and factual bases.

The decision stated: "There being no violation of any law, regulation or the bidding rules, nor any arbitrariness or unfairness committed by public respondents, the presumption of regularity of the bidding for the MCIA Project must stand."

The consortium headed by GMR Infrastructure has been awarded the 25-year contract to expand and revamp the Mactan-Cebu International Airport on build-operate-transfer (BOT) basis.

GMR claimed that it has been successful in improving passenger experience and airport performance that brought a double-digit traffic growth to the airport.

The airport shows an EBITDA of 66% for the calendar year 2015.

A GMR Infrastructure spokesperson said: "We welcome the Supreme Court judgment. It clears any confusion or misconception about the process of airport modernisation.

"This decision reinforces our position as a credible and financially strong airport operator.

"The decision will also boost the confidence of foreign investors in the PPP programme of the government of Philippines and comes at an opportune time when the five regional airports are being bid out, in which GMR is also participating."