Members of Kibbutz Lohamei Hagetaot each stand to get nearly NIS 600,000 if the erstwhile socialist agricultural cooperative exercises its option to sell a 23 percent stake in the Tivall food company to Osem Food Industries.
The kibbutz, which has 290 members, owns 49 percent of Tivall, a producer of vegetarian food products. The kibbutz is undergoing a process of fundamental change and privatization. A minority of members is now demanding that as part of the change, the kibbutz exercise its option to sell the Tivall shares to Osem, a food producer controlled by Nestle.
But a majority opposes the idea of selling, saying the successful industry is the fuel for financing the changes at the kibbutz, and also serves as a financial safety net.
The members do seem to agree that the changes in the community and in the kibbutz business be kept separate. A final decision on the option will be reached through debate by the kibbutz's business management committee, headed by Gezi Kaplan, who is also a deputy manager at Osem.
Kaplan declined to comment for this report, but did say that as the chairman of the kibbutz's business management board, he is recused from Osem's procedures regarding the purchase of Tivall shares.
Osem already holds a controlling 51 percent stake in Tivall. In late 1994, it bought a 50 percent stake for $9 million, and invested another $4 million in its operations. In January 1999, Osem bought another 1 percent for $1.5 million.
The kibbutz also received an option valid until March 2006 to sell Osem another 23 percent. The exercise price will be based on 22 times Tivall's average earnings during the two years before exercise.
In 2001, Tivall netted NIS 36 million, but that dropped to NIS 32 million in 2002. If the kibbutz were to exercise its option based on those figures, Tivall would be valued at NIS 748 million, bringing the kibbutz members NIS 172 million. When divided among the 290 members, each would receive about NIS 593,000.
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