Business in brief
HOT hit with NIS 30 million tax bill; judge rejects bondholder settlement for Elbit Imaging.
Tax Authority presents HOT with NIS 30 million VAT bill
The Israel Tax Authority is demanding that HOT, the cable television and communications company, pay NIS 30 million in value added tax in connection to the firm’s local news operations. The authority claims HOT purchased news production services in the past six years from a number of production firms without paying VAT. For six years starting in 2007, HOT funded its news operations through an arrangement in which the state forwent HOT’s royalty payments. The company says it shouldn’t owe VAT on the value of the services funded by the state. The Finance Ministry considered funding the VAT payments but never followed through in part due to a High Court of Justice petition seeking to halt state funding of local news without a public tender. (Nati Tucker)
Judge rejects bondholder settlement for Elbit Imaging
Motti Zisser’s Elbit Imaging will have to return to the negotiating table over its NIS 2.4 billion debt after Tel Aviv District Court Judge Varda Alshech announced she would not approve the agreement the company reached with creditors. The proposed debt settlement with bondholders would have provided for the conversion of most of the debt to shares. The settlement was supported by foreign equity funds that had acquired 35% of the company’s bonds, but a number of other institutional investors opposed the arrangement. The judge took the opponents to task, however, for not attending the creditors’ meeting. (Shelly Appelberg)