TOKYO: Japan has extended by three months the first-round bidding deadline for a multi-billion dollar concession to run the Kansai international airport, responding to concerns over the deal from potential bidders.
New Kansai International Airport Co, a state-owned company that now runs the airport, said on Tuesday the deadline had been extended to May 22 from Feb. 16, to assuage concerns over profitability and risk held by companies that are considering bidding for the licence.
"By rescheduling the process, we wanted to show that we are flexible in responding to concerns of the potential bidders," said Shinji Nitta, general manager at corporate strategy office for New Kansai International Airport.
The airport operator will hold talks with potential bidders before they decide to place the bid, Nitta added.
In July, Japan opened the bid to operate the nation's fifth-busiest passenger airport, expected to be one of the largest private finance infrastructure projects in Japan.
The licence for the airport, which will be bundled with operating rights for the smaller Osaka international airport nearby, should fetch at least 2.2 trillion yen ($17 billion), New Kansai International said earlier, and forms part of plans by Prime Minister Shinzo Abe to boost private-sector investment in Japan's infrastructure as the country tries to trim debt.
New Kansai in December named nine Japanese companies and 11 foreign airport operators as qualified bidders for the licence, which will be valid for 45 years.
The winning bidders, who would have to repay more than 1.1 trillion yen in debt that New Kansai International Airport owes, are not allowed to terminate the contract voluntarily during that period.
Trading firm Mitsubishi Corp said last week the company needed to be cautious about the bid because the project was "very challenging" considering the length of the concession period and the airport's profitability.
Of the nine domestic firms, housing developer Daiwa House Industry Co said last week that it had dropped out of the process.
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