25 Sep 2007
Five prospective bidder consortia of the 21 interested parties that expressed interest to participate in the bidding for the 25-year concession of the National Transmission Corporation (TransCo) have submitted their prequalification proposals to the Power Sector Assets and Liabilities Management Corporation (PSALM).
To be sure, the interest of the five groups was further piqued by the offer of the Asian Development Bank (ADB) to provide a Standby Facility Support of up to USD250 million to the winning bidder of the 25-year TransCo concession contract. The ADB offer is equal to the amount proposed by the World Bank early this year.
The prequalification documents were handed over to PSALM last 21 September 2007 before 12 noon, the deadline for submission set by the PSALM Privatization Bids and Awards Committee. The PSALM Project Management Team for the TransCo concession accepted and checked the documents against the Pre-Qualification Documents submission List.
Members of the PSALM prequalification team initialed each page of the submitted documents to indicate completeness in terms of the number of pages vis-à-vis the bidders' submission List.
PSALM declined to identify the members of the five consortia, citing the confidentiality agreement between the government privatization arm and the prospective bidders. The list of prequalified bidders will be released after the evaluation of documents is completed. The evaluation process starts immediately. This will include checking the veracity of the submitted technical documents to prove the existence of the bidders' respective "Qualifying Electricity Transmission Systems."
The second stage of the TransCo privatization process, the prequalification procedure enables PSALM to assess the financial and technical capabilities of the investor groups interested in bidding for the TransCo concession. The procedure assures strict compliance with the provisions stipulated in the Electric Power Industry Reform Act.
The prequalification process is also conducted to ensure that only serious bidders with proven domestic or international experience as a leading transmission system operator will be qualified to participate in the formal bidding slated on 12 December 2007.
Bidders for the TransCo concession must have a member or affiliate with experience in operating and maintaining electricity transmission systems comparable to that of the Philippines, consisting of not less than 6,000 circuit kilometers of transmission lines operating at 115 kilovolts (kV) or higher and including within it a system operating at not less than 230 kV and having a peak demand of at least 6,000 megawatts. The member of the prospective bidder who meets the technical pre-qualification criteria must have a net asset value or market capitalization of USD500 million.
Bidders should also have the capability to form a concession that will meet the 60% Filipino ownership restrictions for grantees of a public utility franchise as stipulated in the Philippine Constitution.
The largest foreign and Filipino members of the prospective bidder will need to pass a net asset value or market capitalization criteria.
Strategic Communications and Partnership Division |