Bronfman: We Overpaid for Koor

Ora Coren
Ora Coren
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Ora Coren
Ora Coren

Investing in Koor Industries (NYSE: KOR) was a mistake, the company's chairman and controlling shareholder Charles Bronfman admitted yesterday, in a special interview with TheMarker.

Bronfman and the Kolber family invested in Koor through investment fund Claridge Israel in the late 1990s. In retrospect, in an interview with TheMarker, Bronfman admitted they had paid too much for the conglomerate, which was already starting to flounder.

Its value steadily shrank from the time they came on board until about a year ago. Bronfman and Jonathan Kolber, who serves as Koor's CEO, have lost 60% of their investment on paper.

Claridge should have continued making financial investments, like buying a stake in generic drug giant Teva Pharmaceuticals (TASE, Nasdaq: TEVA), instead of getting involved in managing the Koor group, which was not their area of expertise.

"Management mistakes were made," Bronfman said, adding that he takes responsibility for this, however, along with Kolber and group president Danny Biran.

Nonetheless, Bronfman noted with satisfaction the substantial improvement currently evident in the company's performance.

Nochi Dankner's IDB (TASE: IDBH) group recently bought 10% of Koor for $100 million. Bronfman praised Dankner and said he would not be opposed to Dankner upping his stake in the company so that their collective holding would reach 45%. Claridge owns 30.5%.

Bronfman said that he and Dankner have a handshake agreement to coordinate strategic moves at Koor. "Neither party is going to surprise the other," he said, commenting on the possibility of Dankner buying or selling the shares, as well as of any significant acquisitions or sales by Koor executives. Dankner is also Koor's partner in ECI Telecom, one of its two principal holdings.

The full interview will be published next week.


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