What does Len Blavatnik want at News 13?

Len Blavatnik  credit: Tim Bishop
Len Blavatnik credit: Tim Bishop

"Globes" spoke to people who know Blavatnik well, to assess his role in Yulia Shamalov-Berkovich’s appointment as CEO of News 13, which has sparked a revolt among the channel’s journalists.

Len Blavatnik, one of the richest people in the world, did not foresee the storm over the appointment of Yulia Shamalov-Berkovich as CEO of News 13, certainly not its intensity. He also did not foresee that his lawyers would be required to respond in the High Court of Justice to News 13 employees whose salaries he pays.

"Globes" has spoken to dozens of people who know Blavatnik well, in an attempt to assess his involvement, as the controlling shareholder of Reshet 13, in the surprising and somewhat problematic appointment of Shamalov-Berkovich to head the network’s news company, whether there are underlying interests and, if so, what they might be, and what life will look like at the news organization when the storm clears.

"There's no way he didn’t back it"

About one thing there is apparently no dispute: Blavatnik was privy to Shamalov-Berkovich's appointment. Opinions differ on the question to what extent he forced it on the channel's board of directors, or whether he simply gave it strong backing.

"Nadav (Topolski , Channel 13 chairman - M.V.) can’t stand Yulia. He has held a grudge against her ever since she opposed the merger between Channel 10 and Reshet. Len got to know Yulia under those same circumstances," a former Reshet executive told "Globes." "Six months ago, Yulia came to Len and asked him for a job, literally saying she had no money now. He arranged for her to become an external consultant at Reshet for a NIS 30,000 monthly salary." The same source adds: "My take is that Blavatnik thinks she’s a strong character, and suited to the position. It's not political. You can say bad things about Nadav, but this appointment is not his to make. Also, they're trying to put the blame on the new Reshet 13 CEO, Emiliano Calemzuk ."

This version is in line with the assessment and experience of another former senior executive at Reshet. "Even if it’s not his appointment, there’s no way he didn’t back it." According to him, "It was very clear who Yulia is, and what her positions are. It's also clear that Yulia is built for battle, and when there’s a battle, she flourishes. She's not one to shy away from conflict, and that is exactly what Reshet is banking on."

The big question, according to the same source, is whether this move indicates a change in concept for the news organization from a journalist-centric company of political commentator Raviv Drucker and legal correspondent Aviad Glickman, to a management-oriented company, or a maneuver intended to change the corporate DNA itself, its political orientation. "I'm more inclined to the first possibility," says the same former executive.

"A right-winger trying to distance himself from Netanyahu"

The last public position held by 60-year-old Shamalov-Berkovich was as the chairperson of the Second Authority for Television and Radio. Her familiarity with Channel 13 runs deep, as does her grudge against it, since, as the industry regulator, she opposed the merger between Channel 10 and Reshet that birthed the company in its current form. But this is not the only reason for the many emotions her appointment elicits. In the eyes of the journalists, Shamalov-Berkovich’s political past as a Knesset member in the Kadima faction, followed by her joining the Likud, put her ability to serve as their chief editor in doubt. Moreover, her record includes a series of especially problematic statements, particularly against women. Shamalov-Berkovich does have some past experience with news organizations. About two decades ago, she founded the Russian-language Israeli television channel, and served as CEO of Israeli Russian-language newspaper "Vesti."

The political colors shading the background to the Shamalov-Berkovich appointment raise questions over Blavatnik’s own political views, and motivation for the appointment.

A former Reshet 13 executive discusses his acquaintance with Blavatnik in this context. "He's on the right-wing. It wouldn't surprise me if he thinks the company's employees have gone too far to the left. But it must be said that he doesn't interfere in content, and historically I don't think I've ever heard of a case where he interfered, not with any news general manager, as far as I know. However, when the business itself is failing, he doesn't like it, and at that stage he will get more involved. And today, the business is failing."

Although former Reshet executives claim strenuously that Blavatnik has never interfered in content, many News 13 employees are concerned about Shamalov-Berkovich’s political affiliation, and its implications for the news organization. Since the appointment, there have even been rumors that Blavatnik met Benjamin Netanyahu during his last visit to Israel. However, those around him deny this vehemently, claiming he has not met the prime minister or spoken to him in over five years. Blavatnik and Netanyahu had a relationship in the past, but his associates claim the watershed was the Netanyahu investigations. At that time, Blavatnik gave evidence about their relationship and involvement with media. Since then, there has been no contact between the two, and, those in Blavatnik’s circle maintain, he has distanced himself from Netanyahu and Israeli politics.

Blavatnik's active participation in appointments is historically supported, and News 13 has quite a history of such appointments. Golan Yochpaz , Israel Twito , Aviram Elad , and Or Zelkovnik all served as CEOs in recent years, and some were even flown to meet Blavatnik before being nominated to the post.

Similar actions were also reported at his investment arm when he met Tomer Bar-Zeev, CEO of ironSource , on the eve of a major investment.

Long-standing relationship with Nadav Topolski

In contrast to the high turnover at News 13, Blavatnik's other businesses actually show quite impressive stability in the managerial ranks. Avi Fischer, CEO of Clal Industries & Investments , is a manager who has been with him for many years, as is Reshet chairperson Nadav Topolski, who has also become his partner, and owns a minority stake in the channel.

Their acquaintance began when Topolski was a student studying in the US on a Blavatnik scholarship. "Len is a warm, intelligent Zionist Jew. He gave me a grant, and that could have been the end of the story. But he told me, 'You have an open line to me,'" Topolski told "Globes" in a past interview.

In the same interview, Topolski also talked about how he came to work at Reshet, saying that, after graduating, he began working at Access Industries, Blavatnik's holding company. Then, he said, in 2018, before the merger with Reshet, Blavatnik told him, "about Channel 10 and its huge losses, talked about how he was the only one injecting funds, and asked me to try to help." According to Topolski, he was enthusiastic about the idea. "It sounded like fun. It's a challenge and interesting, so yalla, let’s go. I went back to Israel, landed, went straight to a Channel 10 board meeting, and started working."

A source within the ecosystem familiar with the two told "Globes," "You could say that the relationship between Blavatnik and Nadav is like a father and son relationship." Another source says, "Nadav and Len is a very close relationship."

However, several sources claim that in the channel’s current situation, there is some disappointment with Topolski, and the unshakable trust is actually beginning to be shaken. "Blavatnik intervenes in the company when things go to extremes, when there are events like these, and certainly when he loses money."

"Len is not really involved," says another source. "This may be the first time that a Len appointment was imposed on Nadav."

Senior executives in Blavatnik’s circle responded, "This is a farfetched invention. Nadav is Len's partner in maintaining Reshet 13, they work closely, and Nadav has Len's absolute appreciation and trust."

Will the channel be sold?

Why is Britain’s second richest man even involved in Israeli media? The answer to this question has implications for how Blavatnik will ultimately choose to deal with the current furor.

When people who know him are asked about his motivation for owning a media outlet, even at the cost of significant capital injections, the answers divide into three: Zionism, an expensive plaything, and the notion that, for a businessperson, it never hurts to have a media holding.

"Len is not a manager, he’s an investor. Anyone who really knows him will say that he is a legendary investor. He works his investments in several ways: he knows how to choose assets and people, he knows how to leverage them, he knows how to use philanthropy as an effective tool in leveraging his name and businesses, and he uses the media. He has extremely successful media brands around the world, and even though Reshet is part of this group, he doesn't get anything out of it," says an informed source.

"He likes to own media. His thinking is that even if it doesn't help directly, it doesn't hurt. But Len doesn’t like injecting cash for years. He was forced to do so in the war. Now, he doesn't intend to inject cash."

"At the end of the day, it's a luxury toy, just like owning a football club. If this toy gives him too many headaches, he'll sell it. And there were moments in the past when he wanted to sell the company. If that comes back, and the headaches don't stop, I guess he'll sell," a former Reshet 13 executive told "Globes. " "You must understand, Channel 13’s losses are small change in Blavatnik businesses terms. It's not that he's financially desperate, or that Channel 13 hemorrhaging cash affects his business. However, as a shrewd businessperson, he doesn't want to feel as though he's being played or robbed - certainly not a failure. Business is business."

"In the end, Blavatnik is a businessperson, and if he receives an offer for the channel, then he’ll sell, all the more so in the situation that’s come up now. Everything is for sale, especially for businesspeople like these," a former Reshet executive told "Globes." Other sources "Globes" spoke to share a similar view. Another industry source adds: "From what I know, Reshet is going to be sold. The situation right now is to improve the business in order to sell it. Bring in other money sources, or sell. If you ask me what my assessment is, it will end up with Eli Azur ." Azur is the owner of "The Jerusalem Post", "Maariv," and other media outlets.

Nonetheless, a senior media industry executive says, "Len has invested tens of millions of dollars in this channel over the last four years, among other things so that the channel could survive the Covid pandemic, survive the war. People take it for granted, but Len isn’t someone who likes giving up."

Yulia Shamalov-Berkovich stated in response: "When the journalistic source consists of unfounded, false rumors as part of a campaign of persecution, there is no need to respond."

Published by Globes, Israel business news - en.globes.co.il - on July 3, 2024.

© Copyright of Globes Publisher Itonut (1983) Ltd., 2024.

Len Blavatnik  credit: Tim Bishop
Len Blavatnik credit: Tim Bishop
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