Four-and-a-half months after the cottage cheese protest broke out - a fight against the high price of dairy products which focused on Tnuva, the country's largest food company and dairy - it looks as if the public has at least won the first round.
Yesterday Zehavit Cohen, CEO of the Apax Partners private investment fund in Israel, resigned from her positions as chairwoman of Tnuva and of the Psagot investment house. For its part, Tnuva lowered prices by 15% - and not temporarily, this time. This then forced the two rival dairies, Tara and Strauss, to respond in kind: Chairwoman Ofra Strauss cut prices by 12%. Tara quickly followed suit.
The stock market certainly took notice of the furor - and punished Strauss, and a large number of publicly traded food companies as well. Tnuva and Tara are privately held.
Strauss fell 7.4% yesterday and Osem dropped 5.3% in value. Strauss has lost 13% since the start of the cottage cheese protests. Super-Sol, the country's largest supermarket chain, which is controlled by Nochi Danker's IDB group, has taken a much bigger beating. Also the focus of boycotts and protests, Super-Sol shares have fallen 22% since the protests began. The figure for its Blue Square rival is 29%, plus a number of smaller supermarket chains have dropped well over 20% in value.
Tnuva to release financial reports
Strauss had actually lost even more ground, but the recent boycott against Tnuva's products brought it more customers and its share recovered slightly. Now the pressure on the firm's profit margins has spooked investors again.
The supermarket chains are also worried that Tnuva will force them to absorb much of its products' price cuts - even if it denies it will do this. The supermarkets have yet to receive the new official price lists from Tnuva, but executives say they have already been informed over the phone that they will have to cut their own profit margins.
In response to the public pressure, and in recognition of a possible defeat in court on the matter, Tnuva also announced it would finally release its financial reports to the public. The dairy giant's CEO, Arik Schor, told Army Radio yesterday the data would be released this week. They will refute the assumption, he said, that Tnuva is raking in too much at the public's expense.
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