MANILA, Philippines – The president and chief financial officer of Bangalore-based GMR Infrastructure Ltd. has refuted claims made by the Filinvest-Changi consortium on its alleged financial woes and conflict of interest with another bidder in the P17.5 billion Mactan-Cebu airport project.
GMR president and chief financial officer Sid-Harath Kapur said on Friday that the holding company is financially stable and is not suffering from cash losses. He said the decline in its profits was due to a number of divested assets.
“These losses are post-depreciation, they are not cash losses. We have been making cash profits continuously,” Kapur told ANC.
“It is important to note that the decline in profits has been mainly because of shedding some of these assets and our losses from post-depreciation will completely turn around once are assets are operationalized,” he added.
GMR, which topped the bidding for the Mactan-Cebu International Airport with local construction giant Megawide Construction Corp., has a total net worth of over $2 billion, according to Kapur.
“We are a very strong company, we never defaulted in any of debts,” he said.
Filinvest Development Corp. and Singapore's Changi Airport Group, which submitted the second highest bid for the airport project, insisted the government should disqualify Megawide and its Indian partner GMR for violating rules against conflict of interest.
Kapur called the rival group's allegations that there is a conflict of interest with another bidder, First Philippine Airports Consortium, “completely incorrect” and “baseless.”
The First Philippine Airports Consortium is composed of First Philippine Holdings, Corp. and Malaysia Airports Holdings Berhad (MAHB).
Filinvest said that GMR and MAHB were partners in four GMR airport projects—Delhi International Airport Private Ltd., GMR Hyderabad International Airport Ltd., Istanbul Sabiha Gokcen International Airport Group and GMR Male International Airport—and that the MAHB managing director is a director of the airports.
But Kapur said this is not a violation of bidding rules because the director was not involved in the bidding process.
“They have one director who is represented on airports in India and also airports in Istanbul and Mali, but that gentleman sits on the boards. In this bid, the entity is GMR infra, it is not the airports,” he said.
Kapur also defended the GMR’s commitment to the project, saying it will utilize the same practices it employed in India.
“We see great potential in this country, it’s a dynamic country, like India, and for us we are here for the long haul,” he said.
“What Philippines needs is dynamism in terms of infrastructure. We are a dynamic and capable organization and we will bring that dynamism and capability to play as far as this investment is concerned,” he added.
Kapur expressed confidence that the Department of Transportation and Communications will come up with the right decision on the dispute.