After 10 days of secret talks, which amazingly didn’t leak to the press, and another all-nighter that ended Friday morning, a thing happened in Israel’s business world.
For the first time, bondholders with conflicting interests reached accord, to seize control over the conglomerate from its owner, who was defaulting on its liabilities.
In a proper market economy, if a company’s owners don’t pay up, control goes to the creditors. This hadn’t happened before in Israel, though. In most cases, pressure gets applied, but the owner manages to drive wedges between the various interest groups. In the end, the indebted owner throws them a bone and keeps control.
Thus, for the first time in Israeli history, diverse investment institutions plus a foreign hedge fund did what needed to be done. They decided to take over the company without negotiating. They aim to split up its assets, reorganize the equity structure and set the firm on a new path.
Read more at Haaretz.