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Acquisition by Seal Bidding
There have been various methods by which companies buy most of if not whole, of the target company’s ownership stakes so that they may have full control of the firm that they target. Among is the method of seal bidding. The attainment is mostly made as part of the growth strategy of the company whereby it is more profitable to take over the operations of the existing firm and place as compared to increasing on its own. Acquisition can be unfriendly or in a friendly manner. The friendly acquisition is where the firm expresses the agreement to be acquired (Johnson T, 2007). Hostile is a condition in which the target firm does not have the similar agreement from the firm that is targeted and the process of acquisition requires to actively buy large stakes of the company that is targeted so that they may have the majority stakes. At times the company that wants to acquire often offers a premium on the market price of the target shares of the company so that shareholders are enticed to sell. Seal bidding is a method of acquiring that involves the competitive bids and the awards. The bids are unsealed in the public and awards given as well (Paula B. 2009)
Two ways can be used in the acquisition by sealed bidding.
- Simplified Acquisition method
- Two-step Acquisition method.
However, in acquisition by Sealed Bidding the following conditions have to be met.
- a) The there should be time to allow the solicitation, submission, and the assessment of the sealed bids.
- b) The awards will be prepared on the basis of cost and other factors that are connected to the price.
- c) Conducting discussions with the responding offertory concerning their bids is unnecessary.
- d) There exists reasonable hope of getting more than one sealed offer. With all these conditions, this paper mainly focuses on the procedures that are used acquisition by Sealed Bidding.
In Simplified Acquisition method there are numerous steps that care involved in the acquisition by Sealed Bidding. The steps are (Paula B. 2009);
- A) Invitations for bids are prepared. In this, the requirements of the government are described clearly by the invitations they make. The requirements where the numbers of bidders are limited are prohibited. All the documents are included in the invitation of well prepared potential bidders for the reason of bidding. These documents are either attached in the invitation or included by the reference. The government should prepare the invitations for the bids and contract using the format below. This should be to the maximum practicable extent. As shown
It should contain the section, and the title.
Part 1, The schedule. There are eight steps taken here.
Contract form/solicitation. This part contains;
· Name, address, and the location here the issuing activity is situated.
· The invitation for bids and date of insurance
· Specified time for bid reception
· The numbers of pages
· Requisition or other authorities that would like to make purchases.
· Requirements for the bidders to provide their identity.
· Statement to be included by the bidders in the bids, and the address through which payments should be made.
Services and their prices. It entails;
· A brief description of the services or the supplies is given here. The description contains national stock number, title etc.
· Any other description or the specifications that are needed in addition to the above section (B) to allow complete open and competition.
Marking and packaging
· It gives a provision of packing, making the requirements and preservation.
Inspection and acceptance
· The bids are inspected, acceptance, and the dependability requirements.
Delivery and performance
· Give specifications for the requirements for time, the venue and the method that will be used during the delivery process.
Contrast administration data
· Any accounting and appropriate data that is required and even the contract administration information are included here.
Unique agreement requirements.
· Clear statements of any special contract requirements that are missing out in the section in (I) (contract clause are included here.
· The clauses that the law requires are included here by the contracting officer.
· Any other additional clauses that are missing in other areas.
List of documents, exhibits and other attachments
· The data, the title and the number of the pages care to be listed here.
Representations, certificates, and other statement of bidders
· Solicitation provisions that need representations, certifications or pr5ovition of other information by bidders are included here. instructions
Instructions, conditions and notices to bidders
Evaluation factors for awards
· The price related factors that will be considered in the process of are evaluation of bids and contract awarding are identified.
- B) The invitations of bids are made public. It then distributed to the respective bidders in order to make them public, they are posted in the open places, and by the use of any suitable means. This is done early enough to enable the bidders to get ready and submit their bids before they publicly open the bids (Johnson T, 2007).
- C) Submission of bids takes place here. It is a condition that the bidders should provide the bids that are sealed and only to be opened at the time and the venue stated in the solicitation for the public opening of bids. They are submitted to be received in the office designated in the invitation for the bids. This should be done in time and should not be later than the time set for their openings. If they authorized then, a bid that is telephonic is communicated by telephone call to the designated officer. This shall be given consideration if and only if; the following conditions are met.
- The considerations are authorized by the regulations of the agency.
- The telegraph officer who got the telephonic bids makes a telephone call.
- The designated office is send the telegram that formed the foundation for the telephone call is sent by the telegraph officer who got the telephonic bids.
- The telephone call .............
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