Telit Communications plc (AIM:TCM) today officially announced that Oozi Cats, its suspended CEO, was leaving the company. Cats reportedly resigned his positions in the company's management and board of directors. Telit unexpectedly suspended Cats last week following what it called "speculations about old indictments against him in the US."
Telit today announced that an independent probe conducted by its board of directors indicates that Cats had indeed been indicted, and that this fact had been concealed from the company's advisors. Yosi Fait, who was appointed to replace Cats, will remain in his post.
"The fact that the indictments against Cats were never reported to the board of directors, and that the directors learned about them from third parties, has aroused great anger among the board members," the company report said.
The company simultaneously announced the expected appointment of independent directors, one of whom will become chairman. The board of directors and the CEO replacing Cats will assess Telit's strategy and cost structure.
The company left its forecast unchanged. The board of directors also denied rumors concerning the unreliability of its past reports. Telit also commented on the question of Bames, the Italian company that collapsed, writing that the investigation was just beginning, but that Telit planned to defend its position in the matter.
As reported by "Globes," an investigative report published by Shareprophets.com, a website that publishes information for investors, found that Cats and his wife, Ruth, left the US in 1991-1992 when they were wanted on suspicion of fraud, and an indictment was filed against them. It is suspected that he changed the spelling of his name from Uzi Katz to Oozi Cats after leaving the US.
According to the indictment, Cats offered properties for sale and organized a deal in which the third conspirator bought the property at the market price as a straw man. The property was immediately sold to Ruth Cats at an especially high price. With the help of others, the Cats couple obtained a mortgage, while the information given in order to obtain the mortgage is suspected of being false.
This was not the only legal entanglement of Cats, who is also the leading shareholder in Telit. Reports in Italy and the UK indicate that he is suspected of involvement in the collapse of an Italian company. In 2016, his name was mentioned in an investigation by the authorities in Italy concerning the bankruptcy of Italian company Bames and its Sem subsidiary. According to Italian media reports, the company's 400 workers were laid off following what was called a "fraudulent bankruptcy." The Italian prosecutors investigated 13 people, including Cats, on suspicion of involvement in the affair, in which €230 million "vanished" from Bames.
Bames invested €16 million in 2007 for a 10% holding in Telit subsidiary TWS, which dealt in wireless communications solutions. At the time the investment was made, Telit's own market cap was only €17 million. In response to the investment in its subsidiary, Telit's share price zoomed within a few days.
In 2009, 30 months after Bames's investment in TWS, Telit decided to move its production to China, and canceled its exclusive agreement with Sem 30 months before its scheduled termination. Telit agreed to pay Sem €3 million in compensation. In 2010, Telit repurchased Bames's holdings in TWS for €1.5 million.
Published by Globes [online], Israel Business News - www.globes-online.com - on August 14, 2017
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