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Sources inform ''Globes'' that bidders in an Israel Railways tender for internet services claim that Motorola Solutions Inc's (NYSE: MSI) winning bid is unacceptable, because there is no way that the company met the tender terms.
Last week, Israel Railways awarded the tender to install internet access on 630 carriages and all train stations to Motorola. Israel Railways said that the cost of the tender is NIS 23 million over five years.
The picture that emerges from information obtained by "Globes" is ambiguous. Motorola's bid was significantly lower than the other bids. It is also much less than its bid for transceivers that it will buy from Partner Communications Ltd. (Nasdaq: PTNR; TASE: PTNR) to provide internet access on train carriages.
The tender documents state that Motorola bid NIS 23 million for the project, less than half the bids of the other participants. The difference is illogical, since the costs of the tender and the internet hook-up costs are known. Consequently, the other bidders in the tender, including Bynet Communications Ltd., which bid NIS 45 million, initiated an examination into Motorola's win.
The documents also state that Motorola is offering NIS 160-180 per gigabyte via Partner, a price that makes no sense, given the mobile carriers' bids are around NIS 3,000 per gigabyte. Sources close to the tender say that Motorola could offer much lower prices because, in contrast to its rivals, it manufactures the equipment, and therefore does not have to buy it from other vendors.
Israel Railways said, "The bid was examined by an expert committee and the tenders committee that approved the bid held a thorough discussion on it."
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