Light Rail Transit 1 (LRT 1) Cavite Extension

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The Light Rail Manila Consortium (LRMC), a joint venture between Metro Pacific (55%), Ayala’s AC Infrastructure Holdings (35%) and Macquarie Infrastructure Holdings (10%), won the bid for a 32-year concession to build and operate the Manila LRT-1 Cavite Extension project. The concession agreement was signed in October 2014. The winning proposal included $200 million in upfront concession fees and a commitment to invest $925 million in the construction of the Cavite extension. Once complete, the project is expected to benefit more than one million daily passengers. The project entails roughly 11.7 km extension of the LRT Line 1 from the existing Baclaran station to the future Niyog station in Bacoor, Cavite. Construction is due to start once the DOTC and the Light Rail Transit Authority delivers the right of way, which is expected to occur in June 2016. The project initially attracted interest from seven parties: San Miguel Corp, DMCI Holdings Inc, Megawide Construction Corp, the Spain's Globalvia, France's Ecorail Transport Services and a consortium comprising Malaysia's MTD Capital Bhd and South Korea's Samsung C&T Corp. The winning proposal included payment of $200 million upfront concession fee to the government, foregoing a maximum subsidy of $112 million that was offered by the government, as well as a commitment to invest over $900 million to design and build the Cavite Extension. The concession agreement was signed in October 2014. The concessionaire will have the rights to all revenues derived from LRT fares and commercial developments. The project achieved financial close on 11 February 2016. The consortium signed 15-year Omnibus Loan and Security Agreement for nearly P24 billion with Metropolitan Bank & Trust Company (Metrobank), Security Bank Corporation and Rizal Commercial Banking Corporation (RCBC), majority of the total loan will be used for the Cavite extension with the remaining to be used for the upgrade of the existing LRT1 system. This debt funding will partly finance the project. Details of further debt finance are not disclosed yet. https://ijglobal.com/data/transaction/35686/light-rail-transit-1-lrt-ppp http://ppp.gov.ph/?ppp_projects=lrt-line-1-south-extension-and-operation-maintenance http://ppp.gov.ph/wp-content/uploads/2013/11/LRT1-Annotated-ITPB-SBB-1-9.pdf http://www.reuters.com/article/philippines-infrastructure-railway-idUSL3N0OE1MT20140528 https://www.ifc.org/wps/wcm/connect/3c4fdc804701783183f8ef57143498e5/PPP+Stories_Phillipines_Manila+LRT1.pdf?MOD=AJPERES Debt of P24 billion (approximately $493.7 million as of the date of FC) will be used to partly finance the project. Equity contributions are not available. $200 million paid as upfront concession fee to Government, plus commitment to invest further $925 million. Hence, total project cost is around $1,125 million.