Nochi Dankner today appealed to the Supreme Court against the lower court ruling by Tel Aviv District Court Judge Eitan Orenstin in favor of the IDB Holding Corp. Ltd. (TASE:IDBH) bondholders to transfer control of the company from Dankner to Eduardo Elsztain and Moti Ben-Moshe.
At the same time, Dankner is pursuing his efforts for a new hearing at the Tel Aviv District Court to disclose the report into the sources of Ben-Moshe's money. That report, which was written at the order of Judge Orenstin, is still confidential.
In the appeal to the Supreme Court, Dankner's attorney, Adv. Shmuel Cassouto, states, "It is hard to avoid the difficult impression that the District Court's ruling was strongly influenced by the public's mood stigmatizing Dankner, which was initiated and abetted by interested parties (including some investment institutions and representatives of Extra Holding). It is difficult to avoid the impression that the court was swept away in its ruling and in its decisions, after the apparent public demand to 'punish' Dankner for his alleged business 'failure'."
Cassouto's main argument is that it is not possible to impose the debt settlement on IDB. "Under Israeli law, it is not possible to impose a 'compelled recovery arrangement' on a company. There are only two options: a) a creditors' settlement that is accepted by the company; and b) enforced liquidation under a cognitive procedure stated in the Companies Ordinance."
Cassouto adds that the IDB bondholders' votes on the debt settlement in November 2013, in which Ben-Moshe and Elsztain united, were improper. He claims that although the court initially disqualified Ben-Moshe and Elsztain's petition to consolidate, and stay the bondholders' vote, Ben-Moshe and Elsztain continued their joint proposal while the bondholders' trustees were prevented from counting the votes. Afterwards, the court approved their joint offer. Cassouto claims, "No prize should be given to someone who does not give a damn about court decisions."
Dankner has therefore petitioned the Supreme Court to order "new creditors' meetings, which will vote on the offers for a debt settlement proposed by the company together with investors, after the creditors are shown all the relevant data needed to make an informed decision, and in this regard to issue orders on the way the votes are counted and to disqualify tainted votes and other orders."
Published by Globes [online], Israel business news - www.globes-online.com - on February 2, 2014
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