Firm asks committee to declare Mimosa Estate bidding a failure

By George Trillo

CLARK FREEPORT, Pampanga – One of the two qualified bidders in the privatization of the 200-hectare Mimosa Leisure Estate here said the bidding held last June 8 should be declared a failure.

The bidder, I&D Joint Capital Venture, said the other qualified bidder, Waterfront Phils., has been declared the winner of the R1.5-billion contract.

It was noted that in its bid proposal, Waterfront stated that it would avail itself of the five-year period to pay the going concern value (GCV) of R1.5- billion deal.

On the other hand, I&D Venture stated in its bid proposal that it needs just one year to pay it.

I&D executives said the bidding committee required bidders to have a track record of at least one year of operations, management and/or ownership of a casino and a golf course of at least 18 holes.

They added the declared winner in the bidding does not have any of these required facilities.

The losing bidder said in five years, the weighted present value of the bid winner would come close to P1,285,400,000 while I&D would have P1,494,380,000.

It was reported that I&D lost in the bidding when it failed to include in its sealed bid envelope some documents, such as the bid security check required in the notice to bidders.

Waterfront was declared winner in the bidding, but the bidding committee has required the winner under the term of reference to pay a certain percentage of its bid or approximately more than R900 million.

The payment should be made on or before Oct. 14, 2008. This is a pre-condition for the awarding of the contract to operate and manage the Mimosa Estate. This is on top of the annual rental the winner will pay to Clark Development Corp.

The bidding rules require that the winner pay a guaranteed lease of R150.5 million per year with 10 percent compounded interest every three years.

In the bidding process, the three-envelope system was applied, and when I&D failed to insert in the second envelope the required bid security check, it was immediately disqualified in the bidding. As a result, the third envelope was no longer opened.

The documents in the unopened third envelope show that I&D complied with all of what were required, indicating that its bid was "more profitable to CDC."