The Industry, Trade and Labor Ministry hopes to attract another food business to Hatzor Haglilit in place of Pri Hagalil, which closed up shop in a sudden move on Friday after repeated threats.

Pri Hagalil's owners said they were forced to close the Hatzor Haglilit plant because the government never made good on a promise to give them a NIS 18 million grant.

But senior Finance Ministry and Industry, Trade and Labor Ministry figures yesterday said the promise was never made and that Pri Hagalil is not eligible for a government grant.

In addition, the factory in the Upper Galilee town is profitable, said ministry the sources.

The processing plant has been at the center of a well-publicized battle between workers, management and the government.

The owners, who want to shift operations to a plant in Nahariya as part of efficiency measures, have repeatedly threatened to close the factory or lay off some or all of the employees.

Many of the employees are older and untrained, and earn close to minimum wage. They are unlikely to find jobs elsewhere, say worker representatives.

On Friday afternoon the workers were sent on unpaid leave. Those who came to the factory found the gates locked and security guards stationed outside. Many employees are Shabbat-observant, which means they could not respond until Saturday night.

Industry, Trade and Labor Ministry representatives said they wanted to attract a food exporter to Hatzor Haglilit. Such a company would be eligible for government assistance.

Amending the regulations so that Pri Hagalil would be eligible for a grant would ultimately cost NIS 3 billion, since any other company in the periphery that made an investment but did not export would then become eligible, said the sources.

Meanwhile, the Histadrut labor federation and the Pri Hagalil employees threatened to launch an all-out fight against management if it did not reopen the factory.

The factory is owned by Oshik Efraim, Zaki Shalom and Mordechai Kuperly. Shalom and Kuperly also own the Hetzi Hinam supermarket chain. Pri Hagalil workers said sanctions could include a boycott of the chain.

Histadrut chairman Ofer Eini said the workers were hostages to the management's dispute with the government.

"Every time the owners have a dispute with the government they threaten to fire workers," Eini said. "They're making cynical use of the employees."

Efraim, who is also the company's CEO, said the workers should be joining forces with the management against the government.

"No other entrepreneur invested NIS 200 million in Hatzor Haglilit, including what it cost to buy the factory," he said.

When asked whether the factory would reopen if the company received the NIS 18 million, he stated, "In theory, yes, although I don't decide alone."

The crux of the issue lies in a discussion with former Industry and Trade Minister Benjamin Ben Eliezer.

"I told them I'd do everything I could so that they could receive the money," he said. "I gave an instruction. Clearly that's not the same as promising money," he said.

The company should receive the money, he said, although he noted that he realized that the Hatzor Haglilit production line was superfluous, given the cheaper-to-operate plant in Nahariya.