MNTC, PNCC set talks to finalize joint venture

MANILA, Philippines - Manila North Tollways Corp. (MNTC), a unit of infrastructure conglomerate Metro Pacific Investments Corp. (MPIC), is scheduled to meet with officials of state-run Philippine National Construction Corp. (PNCC) this month to finalize a joint venture for a planned P23 billion toll road that would connect the North Luzon and South Luzon expressways.

MNTC president Rodrigo Franco told reporters during the launching of NLEXcellence Safety Awards yesterday that the company would present various options to PNCC to pursue a joint venture for the planned “connector road.”

“The directive of the government is to do a joint venture with PNCC, so we are now in the final stage. We still need to make a formal presentation, but we’ve touched base and just discussed. We are hoping (to make a presentation) this November,” Franco said.

A new option being considered, he said, is to expand the existing joint venture between MNTC and PNCC that owns the franchise for both the NLEX and SLEX.

MPIC controls over 67 percent of MNTC while the remaining 33 percent is shared by Egis Projects SA of France, BDO/Global Fund Holdings, and PNCC. PNCC has a 2.5 percent interest in MNTC.

“There’s also a very viable option which is to do it via the existing joint venture company which is MNTC,” Franco said.

However, he pointed out that several issues including the higher cost for PNCC resulting from the increase in its interest in MNTC as well as the dilution of the stake of other shareholders.

Another option being considered is to form a new joint venture company wherein MNTC was looking at a 90 percent interest while the remaining 10 percent would be owned by PNCC.

Franco said the approved option for the joint venture agreement would be presented to the Toll Regulatory Board (TRB) for approval.

“We want to finalize the joint venture this year so we can start construction next year,” he said.

Once a joint venture with PNCC is created, a “Swiss challenge” would no longer be required to the unsolicited proposal of MPIC. Under the proposed expansion, the 5.65-kilometer segment 10 project of MNTC would be redefined to cover the NLEX-SLEX connector road.

The supplemental toll operations agreement (STOA) covers the construction of segment 10 that starts where 2.4-kilometer segment 9 ends on MacArthur Highway and stretches all the way to circumferential (C3) road.

MPIC’s connector road project would complete the north-south industrial development beltway transport axis through the construction of a 13.4-kilometer four-lane elevated expressway. It would decongest traffic in Metro Manila and provide better access to Manila’s ports.

Franco said the project would be completed in 2016 after starting early next year.

Earlier, Transportation Secretary Joseph Emilio Abaya announced that Malacanang gave Citra Central Expressway Corp. of diversified conglomerate San Miguel Corp. (SMC) the green light to start the construction of its own connector road worth P26.5 billion.

President Aquino has approved the contract for the Stage 3 project of the Metro Manila Skyway that would connect the NLEX and SLEX. The 14.2-kilometer road system would decongest EDSA and other major roads such as Quezon Ave., Araneta Ave., Nagtahan, and Quirino.