Workers at Maariv newspaper plan strike ahead of expected layoffs
Nochi Dankner inks deal in Argentina for new IDB cash infusion.
Employees at the Maariv daily are gearing up for a one-day strike this week, to protest the expected loss of most of their jobs. The IDB group sold the newspaper Thursday to Shlomo Ben Zvi.
The strike plans are an effort to halt Maariv's publication of the Yom Kippur holiday issue on Tuesday, and also to shut down Maariv's nrg website. The workers' committee stressed that the shutdown of the paper was for one day only, and that the newspaper's employees intend to continue to have Maariv appear on a daily basis, other than Tuesday's issue. The one-day strike is part of the employees' effort to secure full pension and severance pay when the paper ceases publication under its current ownership.
Maariv has been bleeding money in recent years, but it is not the only IDB business that has faced cash flow problems. In a related development, Nochi Dankner, who controls the IDB group, flew to Buenos Aires at the end of last week, where he signed an agreement with Argentine Jewish real estate magnate Eduardo Elsztain that is designed to pave the way for Elsztain to inject about $25 million into Ganden Holdings, the private firm through which Dankner and his family control IDB Holding Corp. In return, Elsztain will be getting a 10% stake in Ganden, reflecting a market cap for the firm of about a billion shekels.
Elsztain is also getting an option to invest an additional $75 million by the end of this year, for another 20% stake. This would leave Elsztain with a 30% ownership stake, which would trigger the need for regulatory approval by the insurance commissioner due to IDB Holding's ownership of Clal Insurance. The infusion of the initial $25 million, about NIS 100 million, will enable Ganden to provide IDB Holding with about NIS 35 million to meet obligations to outside Series Bet bondholders. It will also give IDB breathing space to raise additional funds.
Back at Maariv, Ben Zvi is expected to rehire only about 300 editorial and administrative staff once the paper is sold by IDB's Maariv Holdings through its Discount Investment Corp. division. The employees of the new Maariv operation are expected to have to renegotiate their employment terms, losing any seniority they enjoyed at the paper in the process.
Maariv currently employs some 2,000 people. The sale to Ben Zvi, whose Hirsch Media publishes the right-leaning Makor Rishon, does not include the newspaper's printing plant in Bat Yam, but print and distribution workers at the paper are also expected to lose their jobs once the printing plant is sold off.
At an initial meeting last week with Maariv staff, Ben Zvi expressed his intention to continue to have Maariv appear as a print newspaper after the ownership transfer, but said he cannot guarantee exactly what the future will hold until he has a full understanding of the paper's operational costs.
TheMarker has also learned that Ben Zvi has scheduled a meeting for this week with Maariv's senior editorial staff, apparently to gauge their willingness to remain at the paper.
Maariv has filed a request in court for a stay of proceedings, on which a hearing is scheduled for this week. In the interim, Tel Aviv District Court Judge Varda Alshech issued an order on Thursday barring creditor banks from taking funds from the newspaper group's accounts to offset funds that the banks claim the newspaper owes them. The judge added, however, that she had not issued a stay of proceedings to protect the paper from claims, and that it was not certain she would do so. She advised the banks to turn to the courts if they wished to collect funds they claimed the paper owes them.