As they take the reins of the IDB group, Argentine real estate mogul Eduardo Elsztain and Israeli entrepreneur Moti Ben-Moshe face the immense challenge of turning around a troubled business while establishing a working partnership.
- Former Insurer to Chair IDB Development
- Fallen IDB Tycoon Dankner Faces Indictment
- Meet the New Boss, Same as the Old One?
- IDB May Lose Super-Sol
- Court: Buyers Can Have IDB
- Dankner Appeals IDB Takeover
- IDB Dev’t on Its Way to TASE Listing
Shaul Lapidot, Elsztain’s representative in Israel, admits that the two men have different styles, but they share the same business vision.
“We’ll need to learn to bridge the gaps between us,” Lapidot told TheMarker in an interview. “But our vision for IDB and its subsidiaries is similar, and that’s what’s important. Lapidot is married to an Israeli with family in Jerusalem.”
A day after IDB was formally turned over to Elsztain and Ben-Moshe, Lapidot – an Argentine now living in Buenos Aires but planning to move to Israel – talked about what’s next for the giant holding company.
Elsztain's and Ben-Moshe’s leadership styles seem very different. Ben-Moshe is quick to comment to the media, while you and Elsztain are much more cautious. As you manage the IDB group together, how will you bridge the gap with Ben-Moshe?
“That’s true. Our organizational culture is different. We have much more experience managing publicly traded companies, and he’s more accustomed to working with privately held companies. We’ll bring our managerial experience to IDB. Moti’s style is a bit different; it better fits Israeli culture, and this too has its advantages.”
Elsztain has said in the past that IDB could cut wasteful spending in many places. What are some examples?
“In the future we’ll want to move to more modest offices [than Tel Aviv’s Azrieli Towers]. This is important in terms of the message and image we want to convey. Part of the savings will be by cutting unnecessary spending on lawyers, media advisers and public relations people.
"During the first stage it will actually be important to strengthen the headquarters staff at IDB. They’ve gone through a difficult period, and now we’ll need to start working together to rehabilitate the company.”
What about the IDB managers identified with the era of IDB’s former controlling shareholder, Nochi Dankner – people like the chief executive of IDB Holding Corporation, Haim Gavrieli, and the chairman of IDB’s Super-Sol and Property & Building units, Rafi Bisker?
“In the first stage we’ll try to minimize the shocks. We have no blacklist, but it’s clear that some of the people you mentioned won’t remain with the group in the long run.”
Have you and Elsztain decided whom to appoint as director to represent your interests on the board of IDB Development Corporation?
“In the first stage [the group’s new controlling shareholders] can only appoint two directors. Moti Ben-Moshe said he wants to be appointed as director representing [his company] Extra.
"On our side it will be Eduardo. Although he doesn’t live in Israel, he’s keen to convey the message that he’s responsible for the management of the group. From an operational perspective it appears I’ll serve as a stand-in director to represent him when he’s not available.”
Lots of people are deeply involved in Elsztain’s other companies: Mario Blejer, an Argentine economist who was a candidate last year to head the Bank of Israel; attorney Saul Zang, vice chairman of Elsztain’s real estate company IRSA; and Elsztain’s brother Alejandro, the CEO of Elsztain’s farm products company Cresud. Are any of them candidates to join the board at a later stage?
“After an interim period, when we take control [of the company], we’ll be able to appoint three directors on behalf of Elsztain and three on behalf of Ben-Moshe. We still haven’t decided who they’ll be. I’ll probably be appointed.
"Alejandro has his hands tied with running [other] companies abroad, so he probably won’t have time. But he’ll definitely be part of our team from afar. Blejer and Zang, who are involved in some of Elsztain’s other business interests, factor into the equation, but we still haven’t made a decision.”