Thailand’s Cabinet has approved the selection of Airports of Thailand Ground Aviation Services Co., Ltd. (AOTGA) as the private-sector partner for two public-private partnership (PPP) projects at Suvarnabhumi Airport, covering ground-handling services and cargo operations with a combined project value of more than THB67 billion.
The Cabinet approved the results of the private-sector selection and the key terms of the PPP agreements for the two projects, according to the Prime Minister’s Office. AOTGA, a subsidiary of Airports of Thailand Public Company Limited (SET: AOT), was selected as the highest-scoring bidder for both projects.
AOTGA is 49% owned by AOT and 51% by SAL Group (Thailand) Co., Ltd. (SAL). Sky ICT Public Company Limited (SET: SKY) holds a 46.8% stake in SAL, Triple i Logistics Public Company Limited (SET: III) holds 25.46%, and My Box Co., Ltd. holds 13.60%.
The first project covers ground-handling services, including aircraft ground support equipment, baggage and cargo handling, and passenger and crew transportation. The project has a total value of THB29.39 billion and will operate under a PPP Net Cost model for 25 years.
Under the arrangement, the government will provide land for the project and oversee the quality and performance of the private operator. The private-sector partner will be responsible for financing, designing and constructing facilities, procuring equipment, and operating and maintaining the project.
The second project covers the operation of a third cargo terminal at Suvarnabhumi Airport, with a total project value of THB37.91 billion. It will also operate under a PPP Net Cost model with a 25-year concession period.
The cargo project will cover import and export cargo, transit cargo, perishable goods, express shipments and e-commerce cargo.
The government said the projects are intended to prepare Suvarnabhumi Airport for continued passenger and flight growth while increasing competition among service providers. The additional operators are expected to improve service quality and efficiency and expand the airport’s capacity to handle rising demand.
AOTGA previously emerged as the top bidder for both projects following a selection process conducted under Thailand’s 2019 Public-Private Partnership Act. The company competed against BAGS Ground Services Co., Ltd., which also passed the technical qualification stage.
The two projects were initially approved by the Cabinet in 2023 after AOT determined that existing ground-handling and cargo-service capacity at Suvarnabhumi Airport was approaching full utilization and could become insufficient as flight volumes recovered following the COVID-19 pandemic.
The approval is expected to strengthen AOTGA’s role in providing ground and cargo services at Thailand’s main international gateway, while allowing Suvarnabhumi Airport to accommodate increasing airline and cargo demand.
For AOT, the projects could provide additional revenue through its ownership stake in AOTGA as well as concession-related payments generated from the airport projects.
