Establishment Norima, 40% holders of the Tel-Aviv Hilton hotel, and David Taick, their representative, today motioned the Tel-Aviv District court for a receiver to be appointed for the Tel-Aviv Hilton Hotel. They also requested Norima and the hotel’s other three shareholders conduct a "Buy Me-Buy You" price war.
Norima and Taick say the other three companies are represented by the Koren, Liss and Rosenthal families. They maintain that, in 1993, differences of opinion developed between the parties, and the families which, apart from Taick, had other business connections, including owning the ‘Moriah’ hotels, left the Taick family in a minority position.
Taick claims that the three companies decided to contract with Israel Gravinski, who has no knowledge in the hotel industry, to supervise and co-ordinate the renovation of the Tel-Aviv Hilton, and illegal acts were apparently carried out by the company. He claims Gravinski acted as if he had full authority, exploiting the fact that Taick’s position had been negated beforehand, while the rest of the shareholders, who are not in Israel, completely ignore the minority opinion and are paying scant attention to what is happening in the company.
Taick claims no information was given him regarding Gravinski’s actions that were later discovered. He said that when questions started to be asked recently, he was shocked to find, that not only was there no intention of letting him have the information he requested, but the transactions exposed at the Tel-Aviv Hilton were clearly illegal.
Background: What are they arguing about?
The dispute among the Hilton’s owners is of long standing, rooted in the fact that David Taick, who holds 40% of the hotel’s shares, is one of Israel’s most active, best known hoteliers, while the other three shareholders are much less interested in hotels and are not involved in Israel’s tourism and hotel industry. Taick is well known for being a tough negotiator with suppliers and hotel owners.
Some years ago the Hilton International chain, which runs the Tel-Aviv Hilton, sought to renovate it. The hotel, which is one of the oldest in Tel-Aviv, required complete renovation as part of the effort to maintain its brand image, as well as the need to construct a much larger parking area.
For years Taick vigorously opposed investment in the hotel, in opposition to his partners opinion. It was only after the matter came to court, some years ago, that a compromise was reached, and comprehensive renovations started, at a cost of $30 million.
Taick is the owner of the Dead Sea Hyatt Regency hotel, has building rights to build a Hilton hotel adjacent to the Dead Sea Hyatt, is building the Intercontinental Hotel opposite the Dolphinarium on the Tel-Aviv shore; he owns of the Tel-Aviv Grand Beach hotel, is building a luxury hotel in Jerusalem's Mandelbaum complex, and holds rights to build a Hyatt hotel on the site of the old Sheraton Tel-Aviv hotel, north of the Tel-Aviv Hilton. Taick also has rights on a lot adjacent to Akirov’s Opera tower on Tel-Aviv’s shore.
The Tel-Aviv Hilton is considered to be one of Israel’s most profitable hotels. The hotel is based on highly developed business tourism, and return tourists, who stay there year after year during holidays and in the summer season. The hotel is managed by the Hilton International chain, under a contract which gives the owners 3% of the business turnover, plus 10% of profits.
Incidentally: Despite the quarrel and serious charges that he has about the running of the hotel, Taick is this evening holding a large bar mitzvah party for his grandson at the Tel-Aviv Hilton.
Published by Israel's Business Arena April 7, 1998