Business in Brief

Eilat mayor plans mass protest against VAT

Eilat Mayor Meir Yitzhak Halevi said Thursday he plans to cut the resort town off from the rest of the world for 24 hours next Wednesday to protest the Finance Ministry’s plans to impose value-added tax on businesses there. Access to the city by land, air and sea will be blocked. Residents intend to cordon off roads leading into the city from the north, and to disrupt traffic at the Taba and Aqaba border crossings and at the port and airport. “Canceling the VAT exemption will destroy the city and raise tourism prices by 20%,” the mayor warned. An airline official said the timing of the planned disruptions coincides with a major legal conference and the scheduled arrival that day of a large number of participating lawyers by air. ‏(Ora Coren‏)

S&P takes Israel Electric off credit watch list

Standard & Poor’s Maalot took Israel Electric Corporation off its credit watch list Thursday, affirming its rating of ilAA- ‏(equal to BB‏+ on the international credit-rating scale‏) and assigning it a Stable outlook. The move came two weeks after IEC started to receive its first deliveries of natural gas from the Tamar field, lowering the cost of energy to power its generators. With a 6.5% hike in electricity rates planned for next month, IEC will also enjoy higher revenues, S&P said. The state-owned utility was put on S&P’s 90-day watch list on November 14, 2012, but the credit-rating agency apparently delayed its final decision on a re-rating in anticipation of gas from Tamar. ‏(Itai Trilnick‏)

Argentina’s Elsztain cleared to hold controlling stake in Clal Insurance

The Finance Ministry granted Argentinean businessman Eduardo Elsztain the go-ahead on Wednesday to hold a controlling stake in Clal Insurance through Nochi Dankner’s IDB Holding Corporation. The move clears another hurdle for Dankner in enlisting Elsztain as a partner and getting the cash Elsztain will bring to help Dankner’s deeply indebted holding company. The permit is contingent on Elsztain exercising his option to increase his stake in Dankner’s Ganden Holdings to 31%, giving him a controlling share in IDB and its subsidiaries, including Clal Insurance. Elsztain has already won permission from the Communications Ministry to hold a controlling interest in Cellcom Israel, another IDB company. Elsztain’s option to buy an additional 21% of Ganden for $75 million has been extended by the company to April 28. ‏(Michael Rochvarger‏)

12,000 Israeli cars included in global recall of Japanese vehicles

Japanese carmakers Toyota, Nissan, Honda and Mazda will all be issuing a recall in the next several days to check a possible problem with driver-side airbags on cars manufactured between 1999 and 2004, and replacing them without charge if necessary. The recall includes over 3 million cars worldwide and about 12,000 in Israel, although no actual malfunctions are known to have been reported anywhere. Notification will be sent to owners by mail. The Toyota recall in Israel includes about 4,800 Yaris, Corolla and Avensis models made between November 2000 and March 2004. Mazda is recalling about 830 vehicles in Israel, including its Mazda 6 model produced in 2002 and 2003. Honda’s recall in Israel includes 3,668 Jazz, Civic CR-V and Stream models made between 2001 and 2003. About 3,000 Nissan cars will be recalled in Israel as well. ‏(Daniel Schmil and Agencies‏)