Sources inform “Globes” that Sakal and James Richardson are the only concerns expected to submit bids in the tender for duty free cosmetics stores in the Ben Gurion 2000 Airport project. James Richardson already operates a cosmetics and tobacco store at Ben Gurion Airport.
As reported in “Globes”, no concern is allowed to compete in more than two of the airport tenders. Sakal’s participation in the cosmetics tender means the concern is giving up its duty free electrical and electronic goods store. Sakal believes that the potential revenue from cosmetics is four times as large as from its current store.
Other concerns that have purchased the tender documents include Super-Pharm, ClubMarket subsidiary New-Pharm, and a US company led by a former James Richardson Israel CEO. Most of the companies that purchased the documents have learned that they are disqualified from the cosmetics tender, since one requirement is at least $200 million in perfume and cosmetics sales over the past three years. Not even Super-Pharm, which dominates this market in Israel, has sold this much, and is therefore barred from bidding in the tender. The entire Israeli perfume market amounts to an estimated $100 million.
Sakal has threatened to petition the High Court of Justice, unless the Israel Airports Authority changed the tender terms by September 16. The financial bids will be filed next week.
The cosmetics store tender is one of the most highly publicized in the international duty free market. Over 15 international and Israeli concerns attended a conference held by the Airports Authority, and expressed great interest in competing. The second tender is for an electrical and electronic goods store, which has attracted interest from Israeli chains, including Shekem Electric, Best Buy, and Traklin Electric. A third tender is for a sporting goods store, in which Sakal, James Richardson, Mega Sport, and Wertheimer are expected to compete. A tender for a jewelry and precious stones store will be held at a later date; H. Stern, Padani Royalty, and international firms are expected to compete. Separate tenders will also be held for VAT-exempt stores, including music, toys, souvenirs, silver and gold jewelry, brand name fashions, and ties. There will also be two shopping mall tenders: one for a duty free area of 15,000 sq.m., and one open to the public at large, who are accompanying airplane passengers, but not flying themselves.
The $1 billion Ben Gurion 2000 project will be launched in mid-2004.
Published by Globes [online] - www.globes.co.il - on September 16, 2003