Invitation for Strategic Partnership to Establish Flight Kitchen at NIIAP as Joint Venture Company

Invitation for Strategic Partnership to Establish Flight Kitchen at NIIAP as Joint Venture Company PIACL is looking for an experienced strategic partner to establish a Flight Kitchen at NIIAP as Joint Venture Company, equipped with state-of-the-art airline catering facilities and capable to meet the demands of PIACL in an efficient manner. Complete details including Terms of References (TORs) and Evaluation Criteria are available at www.piac.com.pk and www.ppra.org.pk Local bidders are required to submit a pay order amounting PKR 3000.00 as a tender fee in the name of PIACL. Tenders are called on Single Stage Two Envelope basis. PIAC reserves the right to reject any or all bids or cancel the process at any stage in line with PPRA rules. Interested bidders are required to send their sealed proposals on / before 24-07-2017 till 30 Hrs (PST) to General Manager Procurement, Supply Chain Department (Store Building), PIACL Head Office, Karachi. Technical proposals shall be opened on same day at 10 Hrs. For any query, please feel free to contact undersigned. General Manager Procurement Supply Chain Department, PIACL Head Office, Karachi. Phone: +92 21 9904 4423, 9904 41 9904 3081 Email address: khijzpk@piac.aero contract.administration@piac.aero srspo.ptc@piac.aero 1 P a g e

Ref: PIAC/SCM/FK JV ISB (FSD)//17 Invitation to Bid Invitation for Strategic Partnership to Establish Flight Kitchen at NIIAP as Joint Venture Company M/S Sub: Invitation for Strategic Partnership to Establish Flight Kitchen at NIIAP as Joint Venture Company Dear Sirs, We are pleased to invite your sealed tenders for the item/ services mentioned above. In case of more than one schedule separate tender for each schedule should be furnished. The terms & conditions of the tender/ supplies/ services are given below:- A) SUBMISSIONOF TENDER 1. You are required to send your tenders addressed to G M P r o c u r e m e n t, Supply Chain Department, PIA Head Office, Karachi, latest by 24-07-2017 by 30 Hrs. The tenders may be dropped in the tender box marked as Tender Box Commercial Purchases placed at the entrance of the PIA Procurement & Logistics Building latest by :30 hours on the specified date. You may also send your tenders through registered A/D mail addressed to General Manager Procurement, which must reach before the closing date and time mentioned above. Tenders will be opened at 11:00 hours on the same day in the presence of the bidders. 2. Tenders received after stipulated date & time shall not be considered. The Corporation will not be responsible for postal delays. The decision of Chairman Tender Committee in this respect shall be final and binding. 3. Bidders are required to submit a Pay Order of Rs.3000/- (Non-Refundable) as tender fees along with Technical Proposal (Local Bidders). B) EARNEST MONEY (Local Bidders) The Tender should be accompanied a Pay Order payable (valid for 90 days from the date of tender opening) of PKR 01 million in the name of M/S PAKISTAN INTERNATIONAL AIRLINES as interest free Earnest Money (Refundable). Earnest Money in any other shape shall not be accepted. Earnest / Security Money deposited against a running contract (s) purchase orders(s) shall not be transferable as earnest money for any other tender. All tenders without Earnest Money shall not be considered. C) SECURITY DEPOSIT The successful tenderer upon award of Contract / Purchase Order will be required to furnish security deposit (pay order/ bank guarantee) in the amount up to 5% of total tender value stated in the Letter of Acceptance as interest free Security deposit and to remain valid 3-months after the expiry period of the Contract. The Earnest Money already held can be converted into Security Deposit and balance amount if any shall be deposited as above. 2 P a g e

Instructions to Bidder D) PREPARATIONOF TENDER Single Stage Two Envelope Basis The BID (Tender) submitted shall comprise of a single package containing two sealed envelopes, each envelope shall be marked and will contain TECHNICAL and FINANCIAL proposal. On the given tender opening date only Technical Proposal will be opened in the presence of tenderers available. The Financial Proposal shall be shown to the parties but will be retained with PIA without being opened. After Technical Evaluation of the received Technical Proposals, Financial Proposals will be opened publicly at the date, time & venue to be announced and will be communicated to the bidders in advance. PIA will open the Financial Proposals publicly of the parties whose Technical Proposals have been found acceptable. Financial Proposals of the technically not-acceptable bids shall be remained un-opened till the completion of tender process and shall be returned to the respective bidders. E) PREPARATION OF TENDER - TECHNICAL PROPOSAL: All mandatory requirements are given in the schedule Please give all the available technical details of the items offered by you, supported with the technical literature, brochure, drawings and pictures, client list details, authorization certificates etc. BIDS / Tenders / Technical Proposal received shall be evaluated in accordance with the given technical specifications/ criteria. PIA s requirements are given. Bidders MUST: Be registered with Sales Tax Authorities; please attach copy of Registration Certificate (Local Bidders Only). Affix the company seal on all tender documents. Mention clearly Tender Reference on TOP RIGHT CORNER OF PROPERLY SEALED ENVELOPE, BEARING COMPANY S STAMP F) PREPARATION OF TENDER FINANCIAL PROPOSAL The tenders should be enclosed in double cover. The inner cover should be sealed having enclosed the following documents: a)schedules duly filled in, signed and sealed. b) Original Pay Order for Earnest Money. c) The outer cover should bear address of the General Manager Procurement, Supply Chain Department, PIA Head Office, Karachi and reference number of the tender with description and opening date of tender. d) All information about the services /material proposed to be supplied must be given as required in the schedules to tender. H) PRICES a) The Prices mentioned in the tender will be treated as firm till the completion of Purchase Order/Contract. b) The Prices must be stated both in words and figures. Additional information, if any must be linked with entries on the Schedule to Tender. c) Offers must be valid for120 days from the date of the opening technical proposals. d) Taxes should be mentioned (i.e. Provincial/FBR/other) along with tax rate. 3 P a g e

TERM OF REFERENCE FOR THE ESTABLISHMENT OF JOINT VENTURE COMPANY (JVC) FOR THE DEVELOPMENT OF FLIGHT KITCHEN AT NIIAP PIA Intends to establish a JV Company in partnership with an experienced and reputable airline caterer as Strategic Partner for the development of Flight Kitchen of international standard at New Islamabad Airport. JV Company Structure: Following are the basic attributes that forms TOR for the JVC: 1. Share Holding a. PIA, in any case, will be the majority shareholder in the JV Company having shareholding of 51% or more b. Strategic Partner can hold shares up to maximum of 49%. c. Equity participation of PIACL and Strategic Partner will be Rs 0 Million, as per their shareholding. 2. Composition of BoD a. The JV Company will be governed by the Board of Directors. b. There may be total 7 board members (including Chairman). 4 members shall be from PIA and 3 from the Strategic Partner. 3. Management Control a. The management control of JV Company shall rest with the JV Company. However, appointment of CEO of JV Company will be with the consent of Strategic Partner. 4. Legal Structure of JV Company a. The JV Company will be registered and operated as per laws& Regulations of Pakistan 5. Scope of the JV Company a. The JV Company will be responsible for the production of meals as per PIA s requirement. b. The JV Company will be responsible for all activities, ensuring Meal carts are completely ready for the aircraft. This includes production of meals, Tray Set up (TSU) and Dishwashing. c. PIA will ensure availability of centrally procured allied items, i:e crockery, cutlery, meal carts etc. d. The JV Company to ensure meeting space, stores, transport and other operational requirement for PIA as PIA will be responsible for the uplifting of meal carts to aircraft and back. 6. Business Model a. As a part of PIA s share, PIA will guarantee its meal purchase for ground feeding and meals uplift for aircrafts business from NIIAP from JV Company for all its flights for the period of 05 years from the start of production. b. After 05 years, PIA reserve the right to buy out Shareholding of the strategic partner at the prevailing open market value after accessing the value of the company with the help of International/National evaluator. The selection of International/National evaluator shall be made with the approval of 75% of the board members. However, PIA also reserves first right of refusal incase Strategic Partner decides to divest its investment in JV Company during this period. c. PIA will arrange all that land from PCAA for which payable amount will be paid by the Strategic Partner. 4 P a g e

d. As a part of Strategic Partner s share, Strategic Partner will pay to the JV Company for 0% of NIIAP Project cost that includes infrastructure of flight kitchen building, entire equipment, furniture/fixture and vehicles if any. Investment by the Strategic Partner will be treated as Loan to the JV Company. e. The cost of construction and equipment shall be agreed between the parties to the JV contract prior incurring the expenditure. f. Strategic Partner to quote mark-up rate for its investment. g. Profit sharing will be as per the share holding. 7. Capacity of Infrastructure a. Infrastructure should be State of Art having premium quality equipment of international repute to ensure quality, hygiene and HACCP/ISO standards. b. Infrastructure and equipment must have a capacity to handle 20,000 meals a day, with an expansion plan of another,000 meals a day. 8. Pricing Formula a. Pricing formula to be decided by PIACL and the JV Company for PIACL supplies. For rest of the supplies, the JV Board shall be the sole authority to fix the price. 9. Customer base a. PIA is to be the prime customer of the JV Company. However, with the approval of BoD, JV Company may acquire business from other airlines. b. If the Strategic Partner is associated with airline business, then Strategic Partner shall also buy meals for its airline from the JV Company.. Distribution of Dividend a. Dividend to be paid out on of annual net profit after provision for repayment of loan, taxes or available cash flow, after having made sufficient and prudent provisions and reserves for intended future expansion. b. Payment of dividend to be made after approval from BoD. 11. Future Investment a. All future investments and/or Capital injection will be responsibility of JV Company. 12. Governing Law a. Governing Law will be the Laws of Pakistan. b. JV Company to adhere all laws/regulations imposed by PCAA and any other regulatory authority 13. HR Requirement a. JV Company to accommodate PIA staff working at ISB Flight Kitchen on need basis, meeting the merit criteria. 5 P a g e

EVALUATION CRITERIA FLIGHT KITCHEN ON JV For Airline Caterers/ Hotels / Service Providers IMPORTANT NOTE:- As per PPRA Rules and Regulations, all the documents / statements submitted by as Firm / Company for its tender are under Oath. Any document / statement provided, if provided false, miss-stated, concocted, or incorrect any time during or after tenders will result into permanent disqualification and black listing of the Firm / Company / Partners with their names displayed on PPRA website. Total : 0 Qualifying Minimum:75 Technical: S. No. Eligibility Criteria Maximum 01 Specific Experience: Minimum Experience in the Airline Catering Industry. years and more 20 5- years Less than 05 years 0 20 Obtained Status 02 Intangible values cannot be ascertained Operational Capability: Must have at least one operational Kitchen facility capable of serving required number of meals. 03 04 Upto 4000 Meals/day/facility Between2000-4000 Meals /day/facility 5 Less than 2000 Meals /day/facility 0 International Accreditation: Present Business having any International accreditation / certification eg. HACCP / ISO. Having International Certification No International Certification 0 6 P a g e

05 Performance: Service Contract Terminated due to poor quality or bad service in last five years. (May be validated by Legal Services) Yes 0 No Litigation history in last 05 years. (May be validated by Legal Services) 06 No Litigation or Matter decided in favor of company Litigation or Matter decided against the company 0 Financial: (Proof of all attributes required) S. No. Eligibility Criteria Maximum 07 Average Annual Turnover: 01 Billion & above 15 0.75-0.99 Billion 0.50-0.75 Billion 05 Less than 0.49 Billion 0 Current Ratio: 15 Obtained Status 08 09 1 & above 15 0.75-0.99 0.50-0.74 05 Less than 0.49 0 Income Tax: Income tax paid during last 03 years(attach audited income tax statement / balance sheet) Million & above 5- Million 5 Less than 05 Million 0 15 Comments: 7 P a g e

TENDER SCHEDULE A Financial Bid Form S.No. Description Markup rate for investment 01 Establish Flight Kitchen at NIIAP as Joint Venture Company Applicable Taxes (if any) Tax rate ( )% Grand Total PKR (if any) In Words Attention:- Broad Terms and Conditions of Tender:- 1. Rates must be quoted in words and figures both along with all applicable taxes, charges, duties, expenses to be borne by the bidder. 2. Offer must be firm and final and valid for 120 days. 3. Incomplete, mutilated offer or offers without/deficient earnest money are liable for rejection. 4. Copy of certificate of registration with Sales Tax collectorate must accompany the quotation (Local Bidder Only). 5. PIA will have the right to visit the facility / premises of the tenderer or call for any further documents to establish the capability of firms to undertake this order/contract. PIA s decision in this regards shall be final will not be questioned in any court. We/ I hereby confirmed having read and understood the terms and conditions of the tender and we / I expressly confirm and agree that our tender for the supply of above mentioned items are in terms of and subject to the terms and conditions of the tenders. TENDERER S SIGNATURE DESIGNATION ADDRESS Tel No. Fax No. Email GST No. NTN NO. SEAL 8 P a g e

INTEGRITY PACT / DISCLOSURE CLAUSE (To be submitted on Company s Letterhead) Declaration of Fees, Commissions and Brokerage Etc. Payable by the Suppliers, Vendors, Distributors, Manufacturers, Contractor & Service Providers of Goods, Services & Works the Seller / Supplier / Contractor hereby declares its intention not to obtain the procurement of any Contract, right, interest, privilege or other obligation or benefit from Government of Pakistan or any administrative sub-division or agency thereof or any other entity owned or controlled by it (GOP) through any corrupt business practice. Without limiting the generality of the forgoing the Seller / Supplier / Contractor represents and warrants that it has fully declared the brokerage, commission, fees etc., paid or payable to anyone and not given or agreed to give and shall not give or agree to give to anyone within or outside Pakistan either directly or indirectly through any natural or juridical person, including its affiliate, agent, associate, broker, consultant, director, promoter, shareholder sponsor or subsidiary, any commission, gratification, bribe, finder s fee or kickback whether described as consultation fee or otherwise, with the object of obtaining or including the procurement of a contract, right, interest, privilege or other obligation or benefit in whatsoever form from Government of Pakistan, except that which has been expressly declared pursuant hereto. The Seller / Supplier / Contractor certifies that it has made and will make full disclosure of all agreements an arrangements with all persons in respect of or related to the transaction with Government of Pakistan and has not taken any action or will not take any action to circumvent the above declaration, representation or warranty. The Seller / Supplier / Contractor accepts full responsibility and strict liability for making any false declaration, not making full disclosure, misrepresenting facts or taking any action likely to defeat the purpose of this declaration, representation and warranty. It agrees that any contract, right, interest, privilege or other obligation or benefit obtained or procured as aforesaid shall without prejudice to any other right and remedies available to Government of Pakistan under any law, contract or other instrument, be void-able at the option of Government of Pakistan. Notwithstanding any rights and remedies exercised by Government of Pakistan in this regard, the Seller / Supplier / Contractor agrees to indemnify Government of Pakistan for any loss or damage incurred by it on account of its corrupt business practices and further pay compensation to Government of Pakistan in any amount equivalent to ten time the sum of any commission, gratification, brief, finder s fee or kickback given by the Seller / Supplier / Contractor as aforesaid for the purpose of obtaining or inducing the procurement of any contract, right, interest, privilege or other obligation or benefit in whatsoever from Government of Pakistan. 9 P a g e