A new threat looms for the Ashdod desalination plant project. On Friday, the Tel Aviv District Court gave BGS Desalination Consortium, one of the losers in the tender, a 45-day extension to file an administrative appeal against the win by rival IVM, a joint venture of Minrav Holdings Ltd. (TASE: MNRV) and Spain's SADYT.
BGS comprises Arison Holdings Ltd. unit Shikun u'Binui Holdings Ltd. (TASE: SKBN), Azrieli Group unit Global Environmental Solutions Ltd. (GES), held through Granite Hacarmel Investments Ltd. (TASE: GRNT), Shafir Civil and Marine Engineering Ltd., and Baran Group (TASE: BRAN; Pink Sheets:BRANF).
In a letter to Accountant General Shuki Oren and Mekorot Initiative and Development Ltd. CEO Giora Gutman, who chairs the company's tenders committee, BGS claims that flaws in the tender justify its cancellation. BGS claims, among other things, that the tender committee's pricing of IVM's bid was flawed and that IVM did not meet the legal or professional threshold criteria to participate in the tender.
The Ashdod desalination plant is due to produce 100 million cubic meters of fresh water a year, beginning in 2012. BGS won the tender in November with a bid of NIS 1.65 billion.
The Ministry of Finance is now considering cancelling its agreement with Mekorot National Water Company subsidiary Mekorot Initiative after the company rejected the ministry's demand to commit to a price of NIS 2.36 per cubic meter of water.
Mekorot Initiative was not available for comment by web-posting.
Published by Globes [online], Israel business news - www.globes-online.com - on January 6, 2010
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