Arbitrator throws in the towel on Burger Ranch squabble
It is impossible to achieve a compromise in the Burger Ranch squabble between Paz, run by investor extraordinaire Zadik Bino, and his former protege Yossi Lubaton, attorney Ram Caspi announced yesterday. The parties will have to return to the court for a ruling, he said.
While trying to bridge their differences, Caspi concluded that Bino and Lubaton, the former manager of the Burger Ranch chain in Israel, could no longer work together.
Lubaton holds an option to buy control over Burger Ranch or alternatively to receive compensation from Paz. Since he lacks the financial ability to buy the chain at its market value of NIS 27 million, the acquisition is out. But the parties failed to agree on due compensation. Insofar as could be ascertained, Paz's offer remained half a million shekels below Lubaton's demand.
The feud began when Lubaton filed a petition in the Tel Aviv District Court, asking it to block the deal Paz was poised to sign, selling Burger Ranch to the Neto food group (formerly known as Meir Ezra).
Lubaton claimed Paz agreed to lend him enough to buy 40 percent of Burger Ranch, at a company value of NIS 27 million. The agreement had reached the final draft stage, and though it was never signed, Bino had given him his word about the deal, he claimed.
Later, Bino evidently changed his mind, calling it a stupid deal that did Paz no good, Lubaton said. Bino suggested Lubaton accept an option to bring in other shareholders who would buy Burger Ranch under different terms, saying that would work for both parties. Lubaton claimed he agreed to discuss that option but insisted the agreement with Paz remain in force.
Bino said Lubaton had to bring additional collateral, beyond shares in the acquired company, and since he did not do so, Bino had to withdraw.
Judge Drora Pilpel refused to stop the deal, and suggested the parties try arbitration. They accepted her suggestion, which she limited to a 10-day process. Now that the process has failed and Caspi has thrown in the towel, the court will have to reconvene.