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Thursday, March 28, 2024

PCC clears Clark venture to build P122-b govt hub

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The Philippine Competition Commission said Tuesday it approved the joint venture between state-run Bases Conversion Development Authority and Malaysian developer MTD Capital Berhad to build the 207-hectare National Government Administrative Center in New Clark City in Central Luzon.

The anti-trust body said in a decision signed on March 13 the Mergers and Acquisitions Office found that the transaction would not result in substantial lessening of competition. The project is estimated to cost P121.8 billion.

“The creation of the joint venture will not have any substantial structural effect on the market,” the PCC said in the decision.

The proposed joint venture will handle the financing, design, engineering, establishment, construction and eventually the operation of the National Government Administrative Center in New Clark City in Clark Special Economic Zone within BCDA’s jurisdiction.

New Clark City, a 9,450-hectare flagship project of BCDA, is envisioned to be the country’s first smart and green city with a mix of residential, commercial, agro-industrial, institutional and information technology developments.

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MTD submitted to BCDA an unsolicited proposal in October 2017 to build the center through a joint venture agreement. The proposed center will not just house satellite offices but the major administrative offices of various executive departments and agencies.

MTD and BCDA also subjected the project to a competitive challenge to private sector participants. MTD won as original proponent.

Under the joint venture, BCDA agreed to the use of its idle land for 25 years as the site of NGAC, but will retain full ownership of the property.  MTD will finance, design, build and develop the infrastructure, facilities and improvements comprising NGAC.

The joint venture will be 10-percent owned by BCDA and 90 percent by MTD.  The two parties will share in the profits from lease and purchase payments and from the operation and management of the center proportionate to the monetary value of the joint venture.

Among the salient features of the proposal is the construction of an extension office of the Philippine President and executive buildings, site development for embassies and international schools, buildings to serve as housing for government employees, sports facilities, a central communications and security command center, public schools, a government hospital, a public library. and buildings for community centers With Othel V. Campos

The first phase of the project will cover 50 hectares with a projected cost of P17 billion.

MTD Capital Berhad is a Malaysian investment holding company with interests in civil engineering and construction, infrastructure development, real estate and property development, energy, ports and manufacturing of construction related materials.

PCC is the country’s antitrust body mandated under the Philippine Competition Act to review mergers, acquisitions and joint ventures of firms across all sectors, including GOCCs that meet the threshold to ensure that these deals will not harm the interest of consumers.

New Clark City will complement other big-ticket projects in partnership with the Transportation Department including Clark International Airport expansion and the Subic-Clark Cargo Railway. With Othel V. Campos

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