A bidder in a tender for providing credit services to the Israeli Post customers contended that the winning bid was deficit and unprofitable and therefore should be disqualified.
The Court rejected the petition and held that there was no flaw in the selection of the winner of the tender. A deficit bid in a tender does not, by itself, lead to its disqualification. Sometimes there is an economic rationale behind a deficit bid, but the authority must take restraining measures while making the decision, based on a complete factual infrastructure and grant the bidder the right to be heard. Here, after the winning bid was selected and allegations were made before the purchase committee that the bid was a "deficit bid", the committee addressed the issue, looked at the business plan presented by the winner and the calculation made by the finance manager of the Israeli Post according to the winner's documents and after the committee found that the bid was not a deficit bid as contended, it approved the selection of the bid as the winner in the tender. Therefore, in the absence of any other flaw, the decision of the tender committee does not justify intervention of the Court.