Melbourne Metro EOI Responses Bidding considerations Sep 2013
Procurement process – where does an EOI response fit in? ► Options
appraisal ► Affordability ► Market Sounding
► Experience ► Capability ► Innovative
► Detailed
bid development ► Deliverability
ideas
Business Case
Expressions of Interest
Request for Proposal
► Final
negotiations of solution and cost
Preferred Bidder
Affordability Value For Money
© 2011 Ernst & Young Australia. Liability limited by a scheme approved under Professional Standards Legislation.
► Money
starts flowing and delivery commences
Financial Financial Close Close
Who are the consultants and contractors to an SPV? Advisers • Financial • Legal • Technical (Design, QS etc)
State Government Project Finance Debt
Service Payments
Advisers • Financial • Legal • Technical (Design, QS etc)
PPP Company (Usually an SPV) FM Payments
Facilities Maintenance Provider(s)
Example Providers • Spotless • Honeywell • DTZ/UGL • Serco • MTR Corp
Equity D&C Payments
Example Sources • Bank debt • Capital markets (bond debt) • Institutional (super funds)
Example Sources • Contractor • Super funds • PPP investment funds • International pension funds
Design & Construction Contractor(s)
Example Providers • John Holland • Leighton Group • Lend Lease • McConnell Dowell
© 2011 Ernst & Young Australia. Liability limited by a scheme approved under Professional Standards Legislation.
Example: North West Rail Link
EOI – What the State is looking for Articulate your value proposition ► Bidders with a genuine understanding of and commitment to the Project ► ► ►
Demonstrate relevant experience of dealing with key issues – tailor to the Project Practical approach (believable – demonstrable) Broad experience and capability covering all project elements: ►
► ► ►
Finance & funding: Who will provide the debt funding and equity investment? Who will coordinate and ensure the best loan terms are achieved (financial advisor)? What commercial revenue opportunities might there be? Design: Who will undertake the engineering design and architectural design? Do they have relevant past experience? Construction: Does your builder(s) have the size, capability and experience to deliver all elements of the project? Eg tunnelling, rail systems, stations Maintenance/Operations: Do your team members have strong experience in providing maintenance services to station, tunnels and rail projects? Do they have capability with IT systems such as passenger information displays?
© 2011 Ernst & Young Australia. Liability limited by a scheme approved under Professional Standards Legislation.
EOI – What the State is looking for Articulate your value proposition ► Clear demonstration of ► ► ►
►
Experience Project understanding Proven and tailored approach
EOI is not about identifying the winning bidder – looking for competent parties with great potential to deliver come RFP
© 2011 Ernst & Young Australia. Liability limited by a scheme approved under Professional Standards Legislation.
EOI – How to provide this information ► ► ► ► ► ► ► ► ► ►
►
Answer the criteria - address all aspects Use their terminology Use their structure Keep short and sharp Tailor responses to the Project – avoid generic statements Use examples Ensure consistency throughout response and clear cross-referencing where needed Recognise all aspects of the project: design; build; finance; operate Avoid creating the impression of being ‘finance led’ or ‘construction led’ – provide integrated response Do not assume familiarity of the evaluators with your past achievements or capabilities Make assessment easy for the evaluator!
© 2011 Ernst & Young Australia. Liability limited by a scheme approved under Professional Standards Legislation.
Workshop activities ►
► ►
Your bid team is looking to develop innovative commercial opportunities to improve the competitiveness of your team to the State. Consider possible opportunities attached to the Melbourne Metro Project and develop a shortlist of 2 major initiatives For each initiative consider: ► ►
How will you sell the initiative to potential equity investors? Why would the opportunity be an attractive investment for them? How will you sell the initiative to the State? Why would the State choose your team? What are the benefits of the commercial opportunity to the State; rail users; and/or the wider community?
© 2011 Ernst & Young Australia. Liability limited by a scheme approved under Professional Standards Legislation.
Thank you