Ethiopia: Local Company Wins 800 Million Br Bid to Supply Re-Enforcement Bars

Posted on :Wednesday , 18th November 2015

Local steel company, Steely R.M.I., is supplying 44,075mt of reinforced steel bars worth 804.9 million Br to the government and signed a contract to this effect with the Public Procurement & Property Disposal Service (PPPDS) on November 9, 2015.

The government will pay this company 91 million Br more for the supply than if it had accepted the lowest offer. Steely's price of 18,262 Br per tonne was actually higher by a wide margin than the two other bidders considered, both from Turkey. Vilmesks offered 16,197.6 Br, and Metal Market Dis Tikart's 16,636.99 Br per tonne.

PPPDS is to make the purchase on behalf of the Addis Abeba City Housing & Construction Agency and Addis Abeba City Saving Houses Development Enterprise.

This bid was originally part of another tender, announced in June 16, 2014, for the supply of 175,123tn of reinforcement bars in sizes ranging from 8mm to 24mm. Of the 41 companies that bought the bid documents then, only eight had made it to the technical evaluation. The 14mm bars were excluded the remaining supply was awarded in May 2015 to two foreign companies, Global Africa Ltd. and Acemar International Ltd.

Global made the winning offer of 62.5 million dollars for 148,746.5tn in sizes of 8mm to 20mm. Acemar also won with 12.1 million dollars for 26,378tn of 24mm reinforcement bars.

In April 2015, PPPDS announced the bid for the 14mm bars and opened it on June 5, 2015. Six companies had made their offers, only three of them passing to the financial evaluation stage.

The contract award went to the local company that offered the highest price because of the procurement directive which gave a price advantage of 15pc for a local company, with 35pc value added. Steely R.M.I. had to submit audited documents to show that it met the requirement. The 15pc consideration brought Steely's price down to 15,522.7 Br a tonne, helping it win despite the high price it offered.

PPPDS, established in October 2010 by Council of Ministers' Regulation No. 184/2010, with a responsibility of carrying out the procurement of 'common user items' to public bodies, as well as those that have national strategic significance, has managed to conduct three million Br worth of purchases in the first quarter of the current fiscal year.

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