The Power Sector Assets and Liabilities Management Corporation (“PSALM”) Privatization, Bids and Awards Committee (the “Committee”) invites interested parties to participate in and bid for the privatization of the following:

The Geothermal Power Plants Package consisting of the 192.5 MW Palinpinon Geothermal Power Plant located in Valencia, Negros Oriental and the 112.5 MW Tongonan Geothermal Power Plant located in Kananga, Leyte

(the “Asset”).  The Asset is being privatized  on an “as is, where is” basis.

Interested parties must submit a Letter of Interest (“LOI”) statingthe full name, address, telephone and fax numbers of the interested party, name of the principal contact, and signed by an authorized representative. All LOIs must be received by the Committee at the PSALM Office with address at the 7th Floor Bankmer Building, 6756 Ayala Avenue, Makati City, not later than 5:00 p.m. on 22 May 2009 (the “LOI Submission Deadline”). Only interested parties that submit an LOI by the LOI Submission Deadline shall be allowed to participate further in the privatization of the Asset.  

As a prerequisite to the receipt of the Bidding Package, interested parties shall execute a Confidentiality Agreement and an Undertaking pursuant to Section 78 of RA 9136, both in the forms provided by PSALM, and pay a non-refundable fee in the amount of Three Thousand Five Hundred U.S. Dollars (U.S.$ 3,500.00) (the “Participation Fee”). The Participation Fee shall be either in cash, manager’s check, or cashier’s check. All bank charges, if any, shall be for the account of the interested party. The Confidentiality Agreement, Undertaking, and Participation Fee must be received by the Committee on or before 5:00 p.m. on 26 May 2009, to entitle an interested party further participation in the privatization of the Asset.

The Bidding Package, which includes the Bidding Procedures, shall be issued during office hours (9:00 a.m. to 5:00 p.m.) from 11 May until 26 May 2009 (the “Deadline”) at the PSALM Office. Only interested parties who have been issued the Bidding Package by the Deadline will be allowed to participate further in the privatization of the Asset.

Interested parties that submit the LOI must be the parties that will participate in the privatization process, submit a bid and enter into the pertinent agreements. Once an interested party submits the Confidentiality Agreement and Undertaking and pays the Participation Fee, such interested party may no longer be substituted in the privatization process, except through a consortium in accordance with the terms and conditions of the Bidding Procedures, among the requirements of which are: (i) such interested party must own at least a majority of the shares outstanding and entitled to vote in such consortium; (ii) the consortium must be a juridical entity; and (iii) a letter requesting to bid through consortium must be submitted to the Committee on or before the deadline set for the same in the Bidding Procedures.

The schedule of the bidding activities shall be as follows:

Due Diligence                :  11 May 2009 to 10 August 2009
Pre-Bid Conference        :  10 June 2009, 2:00 p.m. at the PSALM Office
Bid Submission Deadline  :  12 August 2009, 12:00 noon at the PSALM Office

References to the dates and times shall be based on Manila time.  Should any of the above dates fall on a holiday, the deadline shall be extended to the same time of the immediately succeeding business day in Makati City.

A two-envelope bidding system will be adopted. Interested Parties will be required to post a bid security equivalent to Five Million U.S. Dollars (U.S.$ 5,000,000.00) in the form of an irrevocable stand-by letter of credit (SBLC), or wire /telegraphic transfer in lieu of an SBLC, which must be acceptable to the Committee. All bank charges, if any, shall be for the account of the interested party. The bid security of the winning bidder shall be substituted by a performance security as guaranty for the prompt, faithful and complete performance of its obligations under the transaction.  The details of the privatization of the Asset are contained in the Bidding Package.

Letters of Interest, Confidentiality Agreements and Undertakings shall be addressed and submitted to:  The Chairman, Privatization, Bids and Awards Committee, PSALM Corporation, 7th Floor, Bankmer Building, 6756 Ayala Avenue, Makati City, Philippines.  Inquiries and clarifications shall be addressed to Mr. Ricardo M. Empleo, Jr. at the PSALM Office or at telefax number (632) 892-6123 or e-mail address rmempleo@psalm.gov.ph.

The Committee reserves the right to accept or reject any interested party or bidder or proposals or bids therefrom, or any part thereof, and/or to waive any defects contained therein and accept the offer advantageous to the Government, without offering any reason whatsoever.  It does not assume any obligation to compensate nor indemnify parties for any expense or loss that they may incur as a result of their participation in the privatization process, nor does it guarantee that an award will be made. Finally, it reserves the right to modify, supplement, or change the Bidding Procedures and other aspects of the privatization process at any time, including the schedule and the venue provided herein, for any reason whatsoever and without giving prior notice.  Interested parties and/or bidders will be notified subsequently of such modifications, supplements, or changes. 

PSALM Privatization, Bids and Awards Committee
(11, 12 & 13 May 2009)