New toll road concession in Indonesia awaits MPTC

MANILA, Philippines — Metro Pacific Tollways Corp. (MPTC) expects to land within this month the contract for its largest project outside the Philippines, completing its entry in an expressway used by about 900,000 vehicles every day.

MPTC president and CEO Rogelio Singson told reporters the company will add another toll road to its portfolio within the month, as Indonesia will declare it the winner of the bidding for a 35 percent share in PT Jasamarga Transjawa Tol.

“We are just waiting for the final government decision that our group, together with some foreign partners, will be awarded,” Singson said.

Jasamarga is the operator of a 676-kilometer portion of the Trans-Java Toll. Once the deal is awarded, MPTC’s international business will outvalue its domestic network, as the Trans-Java Toll services around 900,000 vehicles every day.

MPTC chief finance officer Christopher Daniel Lizo said the company is presently negotiating the terms of the concession. With the talks expected to end soon, MPTC will get its notice of award by the end of May.

Afterward, MPTC targets to achieve financial closing by either July or August, ensuring that the tollway will be included in the business within the year.

MPTC had teamed up with Singapore’s sovereign wealth fund GIC Pte. Ltd. in bidding for a share in Jasamarga as part of efforts to expand its portfolio outside the Philippines.

Metro Pacific Tollways Asia, a unit of MPTC, owns a 40-percent stake in the operator of Sheikh Mohamed Bin Zayed Flyover in Indonesia and operates two projects in Vietnam – the Hanoi Highways Expansion Phase 2 and the Rach Mieu Bridge.

In expanding coverage abroad, Lizo noted the difference in the way that Indonesia builds its toll roads. The government takes care of the construction of expressways and sells their ownership to the private sector once finished.

This way, Lizo said the private sector is free of capital risks resulting from construction delays. In the Philippines, tollway developers like MPTC suffer additional costs in nearly every project on the failure to acquire right of way on time.

Businessmen Manuel V. Pangilinan of MPTC and Ramon Ang of San Miguel Corp. are in talks over the possibility of consolidating their toll road units to create an infrastructure giant that will be listed in the Philippine Stock Exchange.

However, it has yet to be determined whether the Indonesian projects of MPTC will be covered in the joint venture given their cost and size.