Today, the Tel Aviv District Court began the hearing on the bankruptcy demand against Eliezer Fishman. Early in the hearing, Bank Hapoalim's attorney, Adv. Pinhas Rubin, said that the bank had provided a company controlled by Fishman with further credit. "I do not understand why you expand credit in such cases," Judge Eitan Orenstein wondered.
The hearing revolved around the demand of Bank Hapoalim (TASE: POLI) and the Tax Authority to declare Fishman bankrupt due to alleged debts of NIS 1.8 billion to Bank Hapoalim and NIS 200 million to the Tax Authority.
Fishman's attorney, Adv. Shalom Goldblatt, claimed that there is no reason to accept the Tax Authority's demand to appoint a temporary receiver for Fishman. The judge interrupted Goldblatt early on, asking for a relevant reason not to declare Fishman bankrupt, after he himself admitted that he cannot repay his debts. "There is no substantial disagreement that this is an act of bankruptcy and that a receiver has to be appointed," the judge said.
Goldblatt agreed that there is no disagreement as to the fact that Fishman's assets cannot cover all of his liabilities, but claimed that it would be wrong, at the moment, to appoint a temporary receiver, "Rather than take the right and financially proper action and launch a joint process of arbitration. There are many active companies with employees. There are nine professional creditors and the right thing to do is to sit around a round table and talk," Goldblatt said.
Orenstein responded, "If the creditors are such professionals, how did we come to this?" Orenstein added that in any case the right thing to do is to sit and talk. The judge added, "But the assets are no longer Fishman's, and therefore his 'say' is not a 'say'. Why go for arbitration? If you want a creditors' arrangement, go for a creditors' arrangement."
Goldblatt claimed that reports in the media negatively affect the condition of the companies and therefore an arbitration process should be pursued. However, Orenstein insisted that the process should be undertaken with complete transparency, which makes arbitration inappropriate. The Tax Authority's representative also said that the process is unsuitable for arbitration, and that she is concerned over a concealment of assets.
Fishman's overall debts are currently estimated by creditors at NIS 5 billion. Fishman, on the other hand, claims that debts and liabilities, secured with personal guarantees, total NIS 3.4 billion.
Eliezer Fishman is the controlling shareholder in "Globes."
Published by Globes [online], Israel business news - www.globes-online.com - on September 5, 2016
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