Idan Ofer is committed to staying out of the Israeli media market for 25 years as a condition for obtaining a license to produce electricity. He is selling his holdings in the Reshet commercial TV company as part of the process of merging the channel with Channel 10, leaving him with no holdings in any media whatsoever. Ofer made his commitment in a plan agreed with the Committee for the Reduction of Concentration as part of the process of reducing his group's general over-concentration in the economy.
Israel Antitrust Authority director general Dr. Michal Halperin has achieved a great victory: completely removing one of Israel's strongest tycoons from the media sectory. Halperin took advantage of Ofer's desire for the electricity license to force him into an unprecedented 25-year commitment. It is difficult to recall another regulator maneuvering anyone into such a commitment; when the tycoon involved has both business spanning sectors and a very aggressive image, the achievement is much greater, including in terms of the message delivered by the Committee for the Reduction of Concentration.
The agreement reached also makes approval of the merger between Reshet and Channel 10 easier.
There is, however, no reason to pity Ofer, because he is also winning something important - an energy license that will gain him millions of dollars, in contrast to his media holdings, in which he would make no great profit even if the merger between Reshet and Channel 10 is a resounding success. Holdings in the media industry are like ownership of a soccer team: it is a sign of power, an asset to boast about, a proof of membership in a certain club. The profit, if any, is indirect - the protection that it affords the owner within the media organ itself and the ability to exert some influence in other areas also - although in recent years, given the prevalence of investigations into the capital-government-media connection, the ability to exert influence is waning.
Published by Globes, Israel business news - en.globes.co.il - on January 2, 2019
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