Businessman Meir Gurvitz last night filed a request with the secretariat of El Al Israel Airlines Ltd. (TASE: ELAL) for a permit to hold control of the financially troubled airline - a precondition for owning a controlling stake in the company. The request was passed on to the Government Companies Authority.
Gurvitz, 65, is an Israeli-born businessman who has spent much of his life in Britain, and has business interests around the world. In recent years he has been living in the US and most of his investments are in income producing real estate.
In Israel he is the controlling shareholder in Arazim Investment Ltd. (TASE: AZRM), which has income producing real estate in the UK and it is the only public company that he holds. Arazim was hit hard by the financial crisis in 2008 and its debts mounted up to NIS 1 billion, but this has been reduced to NIS 180 million, without any need of a haircut or write down. "This is some indication of his financial capabilities," a source close to him said, "His Israeli activities are only a small and public part of his activities, the rest are spread over Europe and the US."
When asked why Gurvitz would want to buy El Al the source said, "Gurvitz believes that the collective agreements that have been signed with the employees, makes El Al 'interesting' It is clear to him that the company won't bring him profitability in the coming years while he is repaying on the loan."
Gurvitz has yet to file an official bid. The source close to him says that he would also buy shares in the planned public offering of El Al at the end of the month.
Gurvitz even holds a pilot's license and was known to fly the private jet that Arazim once owned. He was born in Kiryat Ata near Haifa and left for England when he was 15 to study at the Gateshead yeshiva. When he was 20 he moved to London with £500 in his pocket, which he had borrowed from a friend, and he began dealing in building materials. In 1986 he bought 73 properties from Lloyds Bank for $50 million together with his friend the late Motti Zisser, and took control of the stock market shell of Arazim. At its peak Arazim was worth NIS 1.1 billion and was traded on the Tel Aviv 100 Index but as mentioned the company fell on hard times after 2008.
Gurvitz refuses to give media interviews has few connections with the local business community and leads an Orthodox life and is said to be connected to the haredi community.
In his attempts to buy El Al, which has been financially crippled by the Covid-19 pandemic, Gurvitz will be competing with Eli Rozenberg, the son of New York based businessman Kenny Rozenberg, who has already bid NIS 260 million for a 45% stake in the airline. Rozenberg will meet the El Al board next Tuesday to discuss his offer. At the same time El Al is moving forward with a public offering of shares of $150 million at the end of the month, after which it will take $250 million in loans, with a 75% State guarantee.
Published by Globes, Israel business news - en.globes.co.il - on August 13, 2020 © Copyright of Globes Publisher Itonut (1983) Ltd. 2020