Gov't approves IMI privatization

Israel Military Industries will vacate land in the Sharon on which 44,000 housing units will be built.

The ministerial committee for privatization today approved the privatization of Israel Military Industries Ltd. (IMI). Minister of Finance Yair Lapid ran the meeting, which approved the plan submitted by Prime Minister's Office director general Harel Locker, who had mediated for weeks between the Ministry of Finance and the Ministry of Defense to close the gaps that threatened the privatization plan.

Under the approved plan, IMI will be broken up. To protect vital national interests, part of the company's operations will handled by a new government company. The rest of IMI will be privatized. In exchange for the privatization, the Ministry of Defense will receive a NIS 300 million budget supplement, after promising to place NIS 500 million in orders a year over five years. These orders are intended to guarantee the jobs of the employees at the new government company.

The ministers also decided that the Ministry of Defense will carry out the planning prior to construction on IMI's current premises in Ramat Hasharon. The land is slated for the construction of 44,000 apartments. To carry out the planning and decontamination of the land from IMI's operations, the ministry will receive NIS 575 million from 2015.

Today's approval by the ministerial committee makes it possible to begin the privatization of IMI, which has been planned for a long time, and which obtained the agreement of the company's employees, the Histadrut (General Federation of Labor in Israel), and government ministries. Under the plan, 1,000 employees will leave the company, after which it will move to the Negev.

Today's meeting also decided that the Ministry of Defense will vacate land near the Kirya in Tel Aviv to allow the construction of an 80-storey skyscraper. The IDF will also vacate areas at the Zerifin base outside Tel Aviv, beginning in 2014. This will allow the marketing of land zoned for 3,500 housing units in Rishon LeZion. The Air Force Technical School in Haifa will also move to the south.

Locker said the agreement achieved the strategic goals set by Prime Minister Benjamin Netanyahu to expand the housing supply in central Israel, strengthen the periphery in the north and south, and provide job security to IMI during the privatization process.

Published by Globes [online], Israel business news - www.globes-online.com - on November 27, 2013

© Copyright of Globes Publisher Itonut (1983) Ltd. 2013

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