"I had an opportunity to invest in Markstone, but I wanted to buy 50% and Elliot Broidy refused. He would only sell me 5%. I was a pig, and I was wrong." Haim Saban has always had a way with words and yesterday at a Los Angeles panel on investments in Israel, he had what to say.
Among the people listening as Saban, who controls Bezeq, described himself in blunt terms were Idan Ofer, controlling shareholder of The Israel Corporation (TASE: ILCO) http://www.themarker.com/eng/tools/toolsResult.jhtml?application=8&chosen=576017; Bank of Israel governor Stanley Fischer; and Bank Leumi (TASE: <a target="_blank" href="http://www.themarker.com/eng/tools/toolsResult.jhtml?application=8&chosen=604611">LUMI</a>) CEO Galia Maor, who chaired the panel.
Maor introduced the panelists before the audience of hundreds of people who had come to attend the Jewish Federations' annual conference.
Usually Ssban and Ofer moan about regulation in Israel as the source of, well, many an evil. This time they could have been the regulator's ambassador to Los Angeles.
"I left Israel in 1976, after going bankrupt, and decided never to do business in Israel again," Saban related on the occasion of breaking his own word to himself and buying Bezeq , the Israeli national phone company, three years ago. "I don't like regulators because they're a pain in the pass. But if I look at the telecoms sector, it's tightly regulated the world wide. Regulation in Israel isn't light, but I can say it's fair and professional."
With a wink to Maor, who was chairing the discussion, Saban said that its easiest to work with Israeli banks, "though they're a little more expensive than the goyim".
In his turn, Idan Ofer described why he decided to invest in The Israel Corporation after years abroad. On his way finance minister New York to Israel one day, he read in the business section of Haaretz that the Eisenberg family was selling The Israel Corporation. He decided he wanted to buy it, on purely economic grounds, not Zionist ones.
Asked about it, Saban also said he'd bought the controlling interest in Bezeq for economic reasons, not Zionist ones. "I'm the most Zionist man in the world, but this was pure business."
Maor asked Saban if he means to turn Bezeq into a multinational company, developing activity abroad. No, Saban said without thinking twice: "Bezeq will not be an international company. The company has great cash flow and we need to use it to improve our cellular infrastructure, invest in digital TV (third-generation cellular) and to develop these businesses in Israel. All this requires heavy investment," he explained.
Broidy, co-founder of the Markston private equity fund, was asked if the fund had any exits on the agenda, and which is the best market for exits. He said there are intentions to float the irrigation systems company Netafim on Wall Street, in the next quarter. At this, Saban interrupted: "If Elliot will allow me, I'm willing to invest in Netafim, even 5% of it."
Idan Ofer said Israel welcomes foreign investment, and added that not all countries do. "I had bad experiences in several countries where we wanted to do business and were rejected, just because we were foreigners. And when the Chinese wants to invest in the U.S., they can't. In Israel assets aren't called national assets," he said.
The main obstacle to investment in Israel is jet lag, Saban contributed. "The jet lag is a killer. Fifteen hours flying time from Los Angeles is an obstacle. But every time you start to land in Israel, the heart starts beating."
Maor, who led the panel brilliantly, described Saban's life: born in Egypt, he emigrated to Israel at age 12, lived in France for eight years and then settled in the U.S. "Are you Egyptian, Israeli, French or American?" she asked him. Saban waited a moment before answering: "Right, I was born in Egypt, I apologize for that. France is another story. I define myself as an Israeli American."
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