The Knesset Finance Committee today approved a NIS 140 million loan for Israel Military Industries Ltd. (IMI) to meet payroll and current expenses. The Government Companies Authority's representative told the committee that IMI had a large cash flow deficit, and that more loans would be needed to keep the company functioning until its privatization and recovery are completed.
Finance Committee chairman MK Nissan Slomiansky (Habayit Hayehudi) said that since the government, the Government Companies Authority, IMI's management and employees, and the Histadrut (General Federation of Labor in Israel) had all kept their promises to complete the processes needed to privatize the company, the Finance Committee was prepared to approve the loans. He told the Government Companies Authority to meet the committee every two months at the most in order to update it on IMI's privatization, and its move to the Negev.
"The case of IMI has lasted for years on end and the disputes between the ministries has resulted in the payment of 10 years of salaries even though it was obvious that some of the employees were not needed. Under pressure from the Finance Committee, it was finally decided to implement the privatization. There is a plan and the agreement was to give a little time for the plan to be planned. The plan is complicated, involving the transfer of military bases and so forth."
IMI CEO Avi Felder thanked the Finance Committee for "its support and assistance in executing the privatization and recovery process. We're working on the list of retirements; almost 1,170 employees will leave the company in the end, and this is no small matter. We've set up teams at the company: a team for organization structure; a team for the move to the Negev; and other teams. The company is organized for the measures. We won't see the gains from the lower salaries before 2015, when the retirement process is completed."
Published by Globes [online], Israel business news - www.globes-online.com - on January 20, 2014
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