Philippine Infradev Holdings Inc. has tapped a unit of state-owned China Railway Construction Corp. (CRCC), one of the world’s largest construction and engineering companies, to build its $3.7-billion Makati subway system project.
In a disclosure to the Philippine Stock Exchange yesterday, Phil.Infradev said CRCC’s wholly owned China Civil Engineering Construction Corp. (CCECC) had proposed to invest $300 million to $350 million in the local company or its subsidiary and undertake the engineering, procurement and construction works for the Makati subway project.
Phil.Infradev, formerly known as IRC Properties, has executed a binding memorandum of agreement with CCECC.
Led by businessman Antonio Tiu, Phil.Infradev aims to construct an intracity subway spanning 11 kilometers with eight to 10 stations that will connect key points in Makati’s two districts at no cost to the city government.
Under the MoA, CCECC has to provide completion performance guarantee for the Makati subway project, subject to the completion of a financial, legal and technical due diligence.
The parties aim to complete the entire due diligence process by May 31, after which they expect to formalize the structure of CCECC’s investment and execute the formal investment agreement.
Established in 1979, CCECC started as the international contracting arm of the foreign aid department of the Ministry of Railways of China. It is now a big-scale enterprise and one of the world’s top 100 international contractors.
The Makati subway project aims to ease traffic bottlenecks within the city, which is home to the country’s premier central business district, and hosts a daytime population of 4.5 million.
It was earlier disclosed that the subway consortium also included Greenland Holdings Group, Jiangsu Provincial Construction Group Co. Ltd., Holdings Ltd. and China Harbour Engineering Company Ltd.
The proposed subway is seen to complement the mass transport projects of the national government