Elovitch ready to relinquish control of Bezeq

Shaul Elovitch

In the wake of the investigation against him, Shaul Elovitch has told banks that he is ready to sell shares in Bezeq as part of a debt settlement.

Bezeq Israeli Telecommunication Co. Ltd. (TASE: BEZQ) controlling shareholder Shaul Elovitch has told Israel's major banks that he is ready to relinquish control of the company by paying off his personal debt to the banks. There will be a meeting later today of Eurocom Communications creditors - the holding company through which Elovitch owns Bezeq - Bank Hapoalim (TASE: POLI), Israel Discount Bank (TASE: DSCT) and First International Bank of Israel (TASE: FTIN). At the meeting in Eurocom House, representatives of the company will present a debt settlement for the nearly NIS 1 billion that Eurocom owes the banks.

Eurocom's representatives will present arrangements for selling the Group's various assets including Internet Gold Golden Lines Ltd. (Nasdaq: IGLD; TASE:IGLD), which holds a controlling stake in Bezeq.

The banks are inclined to prefer a debt settlement rather than liquidating the Eurocom Group through the courts. The banks feel they can achieve a better price without the pressures generated by a court liquidation.

This dramatic development is part of the investigation against Elovitch by the Israel Securities Authority. The probe has seen him barred from Bezeq's offices for 60 days. Elovitch is believed to have agreed to sell a 15% stake in Bezeq or to bring in a partner.

The investigation has weighed on Elovitch's financial situation with Bezeq's share price dropping substantially. "Globes" recently revealed that the banks are pressing Elovitch to repay his debt and one senior banker even said that there was an option to turn to the courts.

Elovitch owes Israel Discount Bank NIS 500 million, Bank Hapoalim NIS 400 million and First International Bank NIS 28 million. Eurocom Real Estate owes Mizrahi Tefahot Bank (TASE:MZTF) and others NIS 260 million but the situation there is better than at Eurocom Communications.

Published by Globes [online], Israel business news - www.globes-online.com - on July 30, 2017

© Copyright of Globes Publisher Itonut (1983) Ltd. 2017

Shaul Elovitch
Shaul Elovitch
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