Kalmar Finland Oy, a Finnish manufacturer, has lost a Sh947 million contract with the Kenya Ports Authority (KPA) due to a critical error in its tender submission.

The Court of Appeal upheld the rejection of Kalmar's bid after it mistakenly changed the quantity of container-handling machines in its pricing schedule from 14 reachstackers to just one. The court ruled this typographical mistake constituted a material deviation that could not be corrected once bids were opened.

Background of the Tender

The contract involved supplying, testing, and commissioning 14 new reachstackers—heavy-duty vehicles essential for lifting and transporting shipping containers at the port. The tender, advertised in December 2025, was restricted to four original equipment manufacturers already operating at the port: Kalmar, Sany, Hyster, and ZPMC. Bidders could submit offers directly or through authorised agents.

Key Court Findings

  • Kalmar's bid was initially the lowest at $5.83 million (Sh754.6 million), while the winning bid from Amberton Holdings FZC, representing Chinese manufacturer ZPMC, was $7.31 million (Sh947 million).
  • KPA disqualified Kalmar during financial evaluation upon discovering the pricing schedule error reducing the quantity from 14 to one.
  • The court determined the error impacted the bid's substance, not just its form, describing it as a "major material deviation" affecting the contract's scope.
  • Attempts by Kalmar to argue that KPA should have sought clarifications were dismissed; procurement law does not allow correction of such errors after bid opening.
  • The court emphasized that allowing post-opening corrections would create unfair advantages and compromise procurement transparency.
  • Kalmar's challenge to Amberton's eligibility was also rejected, as Amberton presented valid manufacturer authorisation from ZPMC, meeting tender requirements.
  • The court confirmed that the lowest bid is not automatically awarded the contract if it is non-responsive, underscoring the importance of compliance and operational viability.

Conclusion

The Court of Appeal dismissed Kalmar's appeal, affirming the procurement process and the award of the contract to Amberton Holdings FZC. The ruling reinforces strict adherence to tender requirements and the finality of bid evaluations in Kenya's public procurement system.