Olive appeals against loss of schools’ laptops tender

The Indian company whose Sh24.6 billion tender to supply laptops to primary school children was cancelled last week has appealed against the decision to deny it the contract.

In papers filed at the High Court on Wednesday, Olive Telecommunications seeks to defend its suitability to supply the 1.28 million laptops. It says the combined average annual turnover of its consortium was double the required Sh8 billion.

Olive accuses the Public Procurement Administrative Review Board (PPARB) of disqualifying it on grounds that were not raised in the requests for review filed by its two competitors Hewlett Packard and Haier.

“The decision is contrary to the rules of natural justice. It is based on grounds which were not pleaded by any of the applicants in the request for review applications that had been filed,” says Olive’s director of sales Ajay Jain in an affidavit supporting the application.

The review team on March 11 revoked the award of the laptops tender to Olive and directed the tender committee to complete the procurement process with only Hewlett Packard (HP) or Haier Group.

It said Olive did not have the financial and technical capacity to supply the gadgets and was not an original equipment manufacturer as specified in the tender documents.

READ: Olive’s school laptops tender is revoked by appeals board

PPARB found that officials at the Education ministry inflated the tender sum by as much as Sh1.4 billion after the final bids were made, against a requirement that value addition on the items would not be charged.

The Indian company had on December 13 quoted a price of Sh23.1 billion ($268,899,669) as its final offer, but was awarded the tender at a price of Sh24.6 billion.

However, Olive says it was not given an opportunity to respond before the award was overruled.

“The present applicant (Olive) was not afforded an opportunity to respond,” Mr Jain said.

The review board’s decision has seen Members of Parliament call for Education secretary Jacob Kaimenyi and other top ministry officials to resign.

Prof. Kaimenyi has vowed to stay put and ordered an investigation to establish whether the tender committee deliberately misled him to award the tender.

READ: Kaimenyi faces MPs’ wrath over cancelled laptop tender

Olive is represented by Mohammed Nyaoga and Ahmednassir Abdullahi while HP has retained the services of Iseme Kamau and Maema Advocates. The ministry was represented by Hamilton Harrison and Mathews at the PPRAB. Haier is represented by LJA Associates.

PPRAB had directed the tender committee to evaluate the bids of Haier and HP and award the winner within 45 days. Prof. Kaimenyi, however, has indicated the tender will be floated afresh.

On Wednesday Justice Weldon Korir issued an order putting the reevaluation on hold and set the application for hearing on April 10.

Olive is seeking an order quashing the review board’s decision and effectively reinstating the tender to it. In the documents, Olive says the Sh1.4 billion top-up was for service charge and not value added services.

The board had in its rulings said that additional services which were listed as warranty and cost of transport were listed separately despite having been included in the original tender.

The firm argues that it had broken down its charges into the cost of equipment and charges for other services.

Olive claims that during the competitive negotiations at the Windsor Golf and Country Club, the tender committee asked all bidders to specifically point out the services to be offered for free and those to be charged.

Olive says the services identified by the tender committee and its cost to be quoted separately was warranty, operating system, warehousing and distribution. “The board failed completely to distinguish between additional services and value added services,” says Mr Jain.

On whether it was an OEM Olive said there were varying definitions of the term but the board chose to go with the one given by HP and Haier.

Olive also questions why the board interrogated its joint venture with a firm yet the matter had not been raised by the rivals.

The company says it would have proven its partnership with New Century Optronics Company Limited had it been given the chance.

The board, however, had said that the tender notification was made to Olive alone, not the joint venture. Mr Jain said the combined turnover of the joint ventures was Sh17.5 billion and not the Sh1.1 billion fronted by Haier and HP.