How did Teva Pharmaceutical Industries Ltd. (NYSE: TEVA; TASE: TEVA) mark the blackest week in its history? The Israeli pharmaceutical company's employees celebrated with a lavish party in Caesarea. After publishing terrible second quarter results, cutting guidance, and despite having to service a huge debt, and seeing its share price plunge 44% with $14 billion wiped off the company's value, Teva invested NIS 1 million in the party, sources inform "Globes."
Employees and their spouses were transported to Caesarea in the buses provided by the company, ate and drank at a free bar and sat overlooking the Mediterranean in the Roman Amphitheater to listen to top Israeli singers Shlomi Shabat and Yuval Dayan. Across the ocean on Wall Street, Teva's share price was falling another 1.77% to $17.19, giving a market cap of $17.45 billion. Two years ago the company was worth $70 billion.
Teva Kfar Saba workers committee chairman Eliran Kozlik wrote on his Facebook page, "It doesn't seem real but tonight is going to happen." His request to postpone the "ostentatious" event was rejected with management saying "there are more employees than the 350" (a reference to the number of employees that Teva plans firing in Israel).
Only last week, Teva acting CEO Yitzhak Peterburg said that by the end of the year Teva's workforce would have been significantly downsized following the acquisition of Actavis, the generics division of Allergan. Teva would have shed 7,000 jobs over the past year since completing the Actavis acquisition with 350 layoffs planned for Israel.
Peterburg also said this week when addressing the current crisis, "In the present crisis we have been compelled to take swift and decisive measures. We are focused on reducing significant costs, producing maximum value from our assets, selling assets and strengthening our balance sheet. We will continue to take resolute steps to cope with Teva's challenges."
Teva said, "Teva provides its employees in Israel some of the best benefits on the market. At the same time due to the major challenges with which Teva is coping this year and the need for savings and streamlining, it was decided, in consultation with the workers committee, to cancel nine workers days in plants and six family days, which would have been open to all employees and their families, from all the country's plants."
"The responsiveness to this step from the employees was high compared to past years and costs were lowered by millions of shekels. The event last night in Caesarea for 2,800 employees and their families included the annual work awards to outstanding employees from all the plants, a huge honor that our workers deserve. We are always thinking about how to remain competitive and attractive for our employees and in a competitive employment market while at the same time reducing expenses as the current situation requires."
Published by Globes [online], Israel business news - www.globes-online.com - on August 11, 2017
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