February 08, 2014 00:00 By The Nation 4,311 Viewed
The BTS-CITIC Consortium has submitted a tender proposal and bidding documents for a concession to operate the Beijing Subway Line 16 Franchise Project for a 30-year period.
According a filing by BTS Group Holdings to the Stock Exchange of Thailand yesterday, the consortium was formed by BTS Group Holdings and CITIC Construction Co. The latter is an affiliate of CITIC Group Corporation, a Chinese state-owned investment company.
Beijing Subway Line 16 in western Beijing is a north-south route from Beianhe to Wanping, totalling 29 stations, with a combined track length of 50 kilometres. The line is expected to commence operations in 2018.
This project is a public-private-partnership investment scheme. The winning bidder is required to invest approximately 15 billion yuan (Bt81 billion) in the electrical and mechanical systems (such as rolling stock, signalling systems, automatic fare-collection systems, and tools and equipment for maintenance) and to manage, operate and provide maintenance to the system for a 30-year period.
In return, the concessionaire will receive considerations in three parts: fare-box revenue, a state subsidy, and non-fare-box revenue. The civil works (such as subway tunnels, stations and depots) will be invested in and constructed by the state itself.
The BTS-CITIC Consortium is one of three groups invited to bid by Beijing Infrastructure Investment Co (BII), a Chinese state-owned company assigned by the Beijing Municipal Commission of Transport to take charge of the project tender.
The other two groups invited by BII are Beijing Mass Transit Railway Operation Corp (a Chinese state-owned company), the operator of the majority of Beijing subway lines, and Beijing MTR Corp (a joint venture of Beijing Capital Group Co, another Chinese state-owned company, and MTR Corporation, Hong Kong’s subway operator), which currently operates two Beijing lines.
The BTS Group says its board and management have considered this project and decided that it is a good opportunity to expand its rail-mass-transit business in the region. The group cited its strong background and experience in the mass-transit business, as well as its liquidity and financial strength resulting from the successful establishment of the BTS Rail Mass Transit Growth Infrastructure Fund (BTSGIF) last April. In addition, the company has enjoyed the collaboration of CITIC, its consortium partner, which is armed with business strength. CITIC is a large infrastructure construction and engineering multinational company.
CITIC Group Corp operates in a full range of worldwide business, including banking and finance, insurance, fund management, real estate, engineering, energy, machinery manufacturing and information technology.
If the BTS-CITIC Consortium wins the Beijing subway bid and is selected for this project, BTS and CITIC will establish a joint-venture company to operate the project.