January 13, 2009 / 10:07 AM / 10 years ago

UPDATE 1-Ch Karnchang group wins Bangkok mass transit bid

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BANGKOK, Jan 13 (Reuters) - Thailand’s Ch Karnchang (CK.BK) tendered the lowest bid to build a 12 km (7.5 mile) electric train line, part of Bangkok’s 36 billion baht ($1 billion) “Purple Line” mass transit project, a government agency said on Tuesday.

The group, in a joint venture with Japan’s Tokyu Construction (1720.T), bid 16.7 billion baht, lower than the more than 17 billion baht from two other contenders, an official at the Mass Rapid Transit Authority of Thailand (MRTA) told reporters.

This is the first of three contracts for the rail line, which will stretch 23 km (14 miles) from Bang Sue in the northern part of central Bangkok to Bang Yai in Nonthaburi province to the west.

Another two contracts will be opened for bidding in coming months.

Other major contenders are top construction company Italian-Thai Development (ITD.BK) and number three Sino-Thai Engineering and Construction (STEC.BK).

Chukiat Potayanuwat, MRTA assistant governor, said it was likely the MRTA board would negotiate with Ch Karnchang group to reduce the contract price since the cost of building materials had fallen.

The bid is subject to approval from Japan International Cooperation Agency, which is providing financial support for the project, and then from the cabinet, said Chukiat, also chairman of a committee overseeing the bidding.

The Purple Line project in Bangkok is the most advanced of the government’s big infrastructure projects, which have been delayed for several years.

The government had planned to spend 1.6 trillion baht on infrastructure projects in 2009-2011, including mass transit lines in Bangkok, rural roads and irrigation projects.

Shares in construction firms have risen sharply on hopes the new government would move ahead with the projects.

At 0930 GMT, Ch Karnchang shares, which had risen 66 percent over the past three months, were down 1.9 percent at 4.10 baht, while the overall market was down 3.54 percent.

Sino-Thai, which gained 82 percent in the last three months, slipped 8.44 percent to 2.82 baht while Italian-Thai lost 13 percent to 2.46 baht. ($1=34.91 Baht) (Reporting by Kochakorn Boonlai; Writing by Khettiya Jittapong; Editing by Alan Raybould)

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