Sin of shirking responsibility / Clubmarket owners who show no remorse
Clubmarket's collapse may have left numerous suppliers and customers abandoned, but Oded (Dedi) Borovich, one of the company's former owners, is anything but sorry.
"I made no mistake," he declared in a Rosh Hashanah interview with Maariv. "I just lost a lot of money, and I'm not looking to apologize to anyone."
That attitude - refusing to accept any responsibility - reminded everyone why they are so angry at him and his partners over Clubmarket's demise.
There are many guilty parties in the Clubmarket affair from the perspective of its former owners, the Mozes-Borovich-Rosen group: the banks, which cut off the flow of credit; the suppliers, who ran to tell the press that payments were halted; and the reporters, who dared to publicize the chain's woes.
Yet, it's now clear the deal with which the group landed Clubmarket in 2001 was never that hot. The owners merely transfered the burden of debt exposure from the banks to suppliers and, to a lesser degree, gift certificate buyers.
The collapse left these groups stranded. Strauss-Elite lost more than NIS 60 million. Small business owners are now in danger of collapse due to the credit they extended the chain. Thousands of customers who bought or received NIS 200 million worth of Extra Tav gift certificates, albeit at a 16 percent discount, are also out of luck.
Regarding the banks, Borovich expressed "surprise" at their conduct. "They still don't understand why we were forced to seek bankruptcy protection," said Borovich, who forgot to mention that the banks knew of Clubmarket's losses in 2004 and its recovery plan. A commissioned examination of that plan revealed it was short NIS 20-50 million in order to have a long-term chance of survival.
Borovich also neglected to mention that this problem was the reason the banks torpedoed the arrangement. The banks claim they demanded another injection by the owners and only after they refused to do so did they block the credit arrangement, but Clubmarket owners won't confirm this version. They prefer to point out the NIS 8.5 million they injected days before the chain's collapse.
Yossi Rosen, a respected CEO in the business community, also left out this detail in his Yedioth Ahronoth interview. Instead, he claimed that if they banks hadn't fought among themselves, the chain would not have collapsed.
The Clubmarket owners sinned by not showing transparency about the chain's state of affairs. They sinned in going against anyone who dared to claim that the situation wasn't so good.
Now the group is fighting to scuttle the current investigation into the whole affair. Lifting the veil from their business and revealing the actions they took prior to the chain's collapse is what scares the former owners more than anything.
If the abandonment, denial and lack of transparency are the sins, the investigation and the lifting of the veil are the punishments.