Deputy Attorney General calls for halt to IDB vote

Avi Licht: There is no point in a vote on the control of IDB when the Knesset will vote on the concentration bill next week.

There has been a dramatic development in the IDB Holding Corp. Ltd. (TASE:IDBH) saga. In a letter to Israel Securities Authority chairman Prof. Shmuel Hauser, Official Receiver David Hahn, court-appointed expert for IDB Eyal Gabbai, and Tel Aviv District Attorney Commercial Department director Adv. Liav Weibaum, Deputy Attorney General Avi Licht has called for the vote on IDB's debt settlement to be halted, just hours before it was scheduled to take place at 6 pm today.

In the letter, Licht says that there was no point in holding a vote on the acquisition of control of IDF when the Knesset plenum will vote on the concentration in the economy bill next week. "At this time, there is great uncertainty on this matter, but the uncertainty should dissipate in a few days, and it will be possible to review the bill intelligently when the legislative process is completed," he says.

Licht therefore proposes that "the votes should be briefly postponed so that investors can vote in an informed way on the basis of all the relevant circumstances and so that the court will have a full legal picture before approving the agreement."

Gabbai recently sent an urgent letter to the Securities Authority and the Official Receiver asking them to clarify for him the consequences of the concentration in the economy law on IDB's debt settlement. However, until now, they have avoided taking a position on this matter, until the present letter by Licht, who has basically taken the role of the "responsible adult" with regard to the law.

At the IDB bondholders meeting scheduled for today, the bondholders are due to vote on the two offers for investment in the company by the Nochi Dankner-Alexander Granovsky consortium and the Eduardo Elsztain-Motti Ben-Moshe consortium.

Both offers propose reducing the IDB control pyramid (which is currently the highest pyramid in the Israeli capital market), at a time when the concentration in the economy law, which the Knesset Finance Committee recently approved, is up for a vote by the Knesset plenum within a few days.

In a clear message to the Dankner-Granovsky consortium, Licht writes, "The expert report (by Eyal Gabbai - E.P.) indicates that the consortium's (Dankner-Granovsky - E.P.) bid includes the possibility of collapsing the levels above the company. We have not examined these proposals, and we do not intend to take a position on them." He adds, "In any event, the consortium's position as if the provisions of the bill, if legislated, will not apply to its offer is unacceptable to us."

Licht says that the uncertainty about concentration in the economy and its effect on IDB's debt settlement will be clarified when the legislative process on the concentration in the economy law is completed. The Knesset plenum is due to vote on the bill next Monday, after it was approved by the Finance Committee.

Published by Globes [online], Israel business news - - on December 3, 2013

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

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