TA light rail negotiations collapse

The marathon negotiations between the state and the winner of the Tel Aviv light rail tender, the MTS group, collapsed on Wednesday. The gaps between the two sides are simply too great, said one source.

If no compromise is reached in the next few days, the state will announce it is canceling MTS's tender win.

The main dispute seems to be over the additional demands raised by the banks financing the project to lower their risk in taking on the endeavor. The state has estimated these demands at NIS 500 million - at the taxpayers' expense - and has rejected them out of hand.

But talks are continuing between senior officials on both sides in an attempt to reach an agreement.

Finance Minister Yuval Steinitz and Transportation Minister Yisrael Katz agreed two weeks ago that no additional time would be given for negotiations.

The marathon negotiations to close the financial details started Tuesday.