NY Koen Group, a holding company based in Dubai, said Tuesday that it had made a bid to buy Israir Airlines, Israel’s third-largest carrier.
NY Koen, whose interests include business in jewellery and diamond manufacturing, digital technologies and construction, said it was making the bid through its Aero Private Jet unit. Based in Ukraine, Aero Private Jet charters privately-owned business aircraft for charter flights and provides services for groups and individuals. Founded in 2003, it today operates about 3,200 flights a year.
“Aero Private Jet … has a great deal of experience in the field of business aviation and sees the purchase of Israir as a chance to expand their services,” NY Koen said in a statement.
The announcement comes amid a flurry of business deals in the weeks since Israel and the United Arab Emirates normalized relations. On Monday, Reuters reported that eight containers filled with electronics, cleaning supplies, iron and firefighting equipment were unloaded off the MSC Paris, one of the first cargo ships to make the voyage between the UAE and Israel. Israir announced in September that it would begin flgihts between Ben-Gurion International Airport and Dubai.
“On the heels of the United Arab Emirates-Israel normalization agreement, known as the Abraham Accords Peace Agreement, purchase/investment in Israeli aviation by an UAE-based business would help cement the peace accord,” NY Koen said.
Israir has been up for sale for a long time, but the process gained momentum three weeks ago after a Tel Aviv court declared the airline’s parent company, IDB Development Corp., insolvent and ordered its assets liquidated. IDB’s court-appointed trustee, Ophir Naor, last week set a November 8 deadline for Israir bids.
Naor said he was prepared to entertain cash and stock offers, as well as merger proposals. Because coronavirus has depressed global air travel and the value of airlines, he said bids should include milestone payments tied to Israir’s future performance. Bidders will also have to show they have the capital to finance the bid and that they can get regulatory approvals.
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So far, only one other bid has been made, by Rami Levy, Israel’s discount-supermarket king, a week ago. BGI Investments, a publicly traded company controlled by Levy and his brothers Shalom and Dror Haim, offered to pay 70 million shekels ($20.5 million) for the airline as well as take over a $5 million loan Israir made to IDB.
IDB bondholders of Israir’s parent company have said the offer is too low and have faulted it for not containing a milestone component. NY Koen didn’t mention in its statement how much it was prepared to pay for Israir or provide information on any other terms.