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Monday, May 19, 2014

SM open to partnering with San Miguel for alternative to NAIA

Henry Sy's listed holding firm is open to partnering with San Miguel Corp (SMC) for a proposed $10-billion international airport south of Manila.

"We can talk," SM Investments Corp chief financial officer Jose Sio told reporters Monday during the listing of the conglomerate's P15-billion fixed-rate retail bonds at the Philippine Dealing and Exchange Corp.

Last week, SMC president Ramon S. Ang named Filipino conglomerates such as the SM and Ayala groups as possible partners for the airport project. He said the diversified conglomerate was willing to go through bidding for the development.

Sio said there are no discussions with San Miguel, but a possible tie-up with the diversified conglomerate will be good "not [only] for business" but "for country” as well.

"That’s what we need for our country to grow in the next stage, we have to improve our infrastructure. That is very important," he said.

Last week, Ang presented to the government a proposal to construct an international airport that will be located along the Manila-Cavite Coastal Road at the waterfront reclamation project covering the cities of Paranaque and Las Pinas.

The proposed airport, which would be pursued as a build-operate-transfer (BOT) project, would be located on newly reclaimed land reaching 1,600 hectares. Once built, the new airport can accommodate all international and domestic operations at the Ninoy Aquino International Airport (NAIA).

The new airport is near Manila Bay where the SM group, through SM Land Inc, and the Pasay City government are planning a P54.5-billion reclamation project. The Philippine Reclamation Authority is bidding out the right to reclaim the project.

“We’re laying the ground work for the next stage of Philippine economic growth. After the upgrade, we expect we will enter the second stage of development,” Sio said.

SM is in the business of retail, mall operations and development, financial services, residential and property development, hotel and convention centers, and gaming. Aside from its core businesses, the group also has interests in mining, infrastructure, and geothermal energy.

SM suffered a 16-percent drop in earnings to P6.23 billion in the first quarter from P7.42 billion a year ago in the absence of hefty trading gains.

Despite the weakness in the first three months of the year, the conglomerate will end the year with a single-digit increase in net profit, as BDO posts higher interest income and significant loan growth, Sio said in a previous interview.
- Interaksyon

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