While Adv. Shraga Biran and the managers of Alon Holdings Blue Square - Israel Ltd. (NYSE: BSI; TASE: BSI) are in the eye of the business and public hurricane over the huge debt arrangement for the Mega retail chain, sources inform "Globes" that David Wiessman, formerly the all-powerful manager in charge of the group's business, under whom Mega piled up such huge debts, is believed to be establishing a $250 million investment business, and he is moving most of the business of the enterprise he is to manage overseas.
Wiessman himself refused to discuss the matter today, saying only, "The report is incorrect."
Market reports say that Wiessman is apparently set to found an investment fund that will also include Limor Ganot, former CEO of Alon Holdings Blue Square under Wiessman. The sources added that the fund would focus on high-tech, energy, and income-producing real estate in conjunction with US businessmen.
Wiessman himself was successful in running the business of Alon USA Energy Inc. (NYSE:ALJ), in contrast to the collapse of Mega in Israel. Wiessman was the dominant manager in the Alon group for many years. Legal proceedings are currently under way between Wiessman and Biran concerning a separation in Beilsol.
Senior institutional sources told "Globes" that they were unaware of this, although from what was said, it will probably be difficult for Wiessman to raise money from financial institutions in Israel. "Who will give him money? It's ridiculous, although we've heard of stranger things," one source said, adding, "The performance of the Alon Group doesn't exactly inspire confidence. I won't give him a penny. That's not punishment for Mega or anything like that, though; it's because managing an investment fund is a profession that you have to show you're suitable for before any money is given"
In any case, Wiessman still owns 20% of Beilsol, controlled by Biran, after leaving his managerial posts in the group, following the disputes between them. Beilsol, together with the kibbutzim, owns Alon Israel Oil, which has several fields of business, including control of Alon Holdings Blue Square, the owner of the faltering Mega chain. Alon Israel Oil recently completed an arrangement for rescheduling its debt and changing its terms, following which the main effort with the group's creditors began: the attempt to save the Mega chain, whose future is still (very) cloudy.
Published by Globes [online], Israel business news - www.globes-online.com - on July 19, 2015
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