The Philippine government awarded the 170.6 billion ($3 billion) contract to upgrade and operate the aging Ninoy Aquino International Airport (NAIA), the country’s main international gateway, to a consortium led by billionaire Ramon Ang’s San Miguel, transport secretary Jaime Bautista announced Friday.

The group—which includes South Korea’s Incheon International Airport Corp—offered the government an 82.2% share of NAIA’s revenues, well above the 33.3% revenue share offered by India’s GMR Airports International, House of Investments and Cavitex Holdings. The Manila International Airport Consortium—comprising Aboitiz Equity Ventures, billionaire Andrew Tan’s Alliance Global Group, Ayala Corp, Filinvest Development Corp, JG Summit Holdings Inc. and tobacco tycoon Lucio Tan’s Asia’s Emerging Dragon Corp—offered a 25.9% share.

The Philippines is tapping the private sector to rehabilitate NAIA—which has been voted the world’s worst airport a few times by the travel website Sleeping In Airports—to ease the fiscal burden on the government.

“We are committed to collaborating closely with the government and our various stakeholders, harnessing every resource available to us, to transform NAIA into a modern international gateway that Filipinos will be proud of,” the consortium, in which San Miguel holds a 33% stake, said in a statement.

The airport—which handled 48 million passengers in 2019 prior to the pandemic, well above its 33.2 million capacity—has been struggling to cope with burgeoning traffic. In January 2023, a power failure forced the cancellation of more than 300 flights and stranded more than 65,000 passengers.

“We need to improve NAIA,” Bautista said. “It’s a very congested airport.”

The government expects to sign a concession agreement with the consortium within 30 days, with the winning bidder required to pay the government an upfront fee of 30 billion pesos, Bautista said, adding the the transaction will be completed within three to six months.

The project involves almost doubling the airport’s annual passenger capacity to 62 million and a 15-year concession contract that can be extended by another 10 years.

While San Miguel is also building the 740-billion-peso New Manila International Airport that San Miguel is building in Bulacan, about 44 kilometers north of the existing airport, Bautista said the country needs as many airports to handle burgeoning air traffic in the country.

“The estimate is that by 2050, we will need an airport with the capacity of almost 100 million. So we really need another airport,” Bautista said. “I don’t think the operations of Manila International Airport will conflict with the Bulacan Airport.”

Ang—who acquired most of his San Miguel shares from the late tycoon Eduardo Cojuangco Jr. in 2012—is also the chairman and CEO of the conglomerate. He transformed the company from a brewer and food manufacturer into one of the country’s most diversified businesses with interests in real estate, oil refining, power generation and infrastructure. He has a net worth of $3.4 billion, according to Forbes’ real-time data.

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