18 Dec 2007
The concession corporation that will operate the National Transmission Corporation (TransCo) must consist of the same members of the consortium that participated in the bid.
This added safeguard to ensure that the concession corporation will comply with the citizenship requirement as stipulated in the Constitution was made clear by the Power Sector Assets and Liabilities Management Corporation (PSALM). Last 12 December, PSALM declared the consortium of the Monte Oro Grid Resources Corp., Calaca High Power Corp. and State Grid Corp. of China as the highest bidder for the TransCo concession with an offer of USD3.950 billion.
The bidding rules for TransCo require the winning bidder to first incorporate the concession company that will apply for the congressional franchise to run the country's sole transmission system, and this corporation, in turn, must maintain its membership.
This means that the members of the Monte Oro Grid consortium, once they are declared the winning bidder by PSALM, cannot include any new entities in the concession corporation. Thus, the members of the consortium who were prequalified prior to the bid submission deadline will be the same entities that should comprise the concession corporation.
Congress will then have the opportunity to evaluate the members of the consortium in the deliberations for the franchise application.
PSALM's bidding rules and the transaction documents also contain restrictions in the change of the equity of the concession corporation for a period of three years unless, as in other franchises, Congress requires the concession corporation to conduct an Initial Public Offering to open a portion of the ownership of the concession corporation to the public.
Strategic Communications and Partnership Division |