The Ministry of Communications has awarded the mobile carrier tender to Select Communications Ltd., after it disqualified Hezi Bezalel's 018 Xfone Communications Ltd., owned by Marathon Telecom Ltd. and which failed to secure financing. Third place Select Communications, owned by Michael Gelfand and Louis Mayberg, will now have 45 days to present guarantees, and if it fails, the tender will go to fourth place Golan Telecom Ltd.
Mirs Communications Ltd., owned by Patrick Drahi, was the other winner in the tender, with a bid of NIS 710 million.
The disqualification is a major blow for Bezalel, and it is hard to understand how a businessman of his skill could fail so spectacularly. Since winning the tender in April, he tried to get 018 off the ground, hire managers, and plan the establishment of - its mobile network - but he failed in his primary task, to secure NIS 705 million in guarantees to cover the cost of winning the tender.
Market sources say that Bezalel simply did not have the money, and that he assumed risks that were beyond his wherewithal. He and his aides are still claiming that the problem is not financial, but technical, but in view of his recent conduct, it hard to believe that. The project simply seems to have been beyond him.
The question now is whether Select Communications will be as serious as it claims to be and will set up a mobile network. The company was perceived as unusual in among the bidders in the tender and it kept a low profile throughout the process. The company will now have to reveal itself and accurately present its capabilities, since the tenders committee will be much stricter and closely watch the company's preparations for securing the guarantees.
Published by Globes [online], Israel business news - www.globes-online.com - on May 30, 2011
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