El Al Israel Airlines Ltd. (TASE: ELAL) CEO Gonen Usishkin is to step down, following the change of control in the airline. The new board of directors has already started setting up a search committee to find Usishkin's successor, as well as replacements for most of the company's senior management. At Kanfei Nesharim, the holding company through which Eli Rozenberg bought control of El Sal, the hope was that Usishkin would not leave in a hurry, and would remain at least for a while as El Al begins its recovery process with the gradual resumption of scheduled flights.
Usishkin took up the post of CEO in February 2018 after serving as VP Commercial at the airline and before that as head of strategy and business development. Usishkin is a pilot and worked in that role at El Al before transferring to the management ide. He is expected to leave in January 2021. His compensation cost in the first quarter of 2020 was NIS 492,000. His departure is by mutual consent.
In the past year, Usishkin has been coping with the biggest challenge ever faced by El Al, and by the passenger aviation industry in general. The majority of El Al's employees is on unpaid leave, which was recently extended until November 30. Usishkin has had to deal with the grounding of flights, mounting debt, and with the demands of the Ministry of Finance in negotiations on state aid for the company. The aid plan included a $150 million public share offering five weeks ago, in which Rozenberg acquired a controlling stake.
In a letter to El Al employees, Usishkin said, "I wish to inform you that in a joint decision reached together with the chairman of the board, I shall end my term as CEO this coming January. The company's board of directors has begun the search for my replacement. This is not a parting letter, and many challenges still await us, and also great hope."
El Al has yet to draw down the $250 million loan is it due to take as part of the plan agreed with the Ministry of Finance. The airline is currently slowly returning to activity, and after the loan is completed it is due to implement a streamlining plan that involves laying off about a third of its workforce, 2,000 people from its various divisions.
Kanfei Nesharim now holds 43% of El Al; former controlling shareholder Knafaim's holding has been diluted to 13%; and the state holds 14%, after buying shares in the recent offering to the tune of NIS 115 million. At the end of June this year, the company had liabilities of NIS 7.253 billion, which compares with NIS 4.4 billion a year previously. The company's chairman is David Brodet, formerly chairman of Bank Leumi (TASE: LUMI).
Published by Globes, Israel business news - en.globes.co.il - on November 1, 2020
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