The building supply firm Ytong and cable manufacturer Teldor Cables & Systems are two of the 12 Israeli companies that reportedly contracted to help construct the new Palestinian town of Rawabi, near Ramallah - and reportedly agreed to forgo using suppliers from the settlements. The town's developer, Bashar Masri, told TheMarker recently that all the firms involved in building the town had signed a standard contract clause committing them not to use products or services from Jewish settlements.

The names of the two Israeli firms were reported by Army Radio yesterday.

Teldor declined to comment on the matter. But Ytong released a statement on its company website, signed by CEO Sasson Har-Sinai, that denied all association with the boycott.

The statement said the company did not engage in boycotts, and that includes boycotts of the settlements. It also said the firm had fallen victim to "despicable manipulation."

When it bid to supply building blocks for Rawabi, it said, it was merely asked where its facilities are located. It answered Pardes Hannah and Ashkelon, both of which are in Israel proper.

"We didn't expect that such an innocent response would link our name with the offensive boycott of products from the settlements," the statement added.

Har-Sinai reiterated this in a letter to the Knesset Economic Affairs Committee, which debated the matter yesterday.

"To eliminate any doubts," he wrote, "Ytong is a deeply rooted Israeli company that is a full partner in building the Land of Israel - all parts of the Land of Israel."

"Ytong is not a party to such a boycott, or to any other," the letter continued. "It never took part in or contributed to such a boycott, or to any other, and will continue to supply its products to every locale in the territory of the Land of Israel - including the settlements."