Businesswoman Who Lost Control of Israel’s Flag Carrier Sets Sights on Smaller Airline

Tami Mozes Borovitz, former El Al owner, is one of six submitting bids to buy tiny Israir

Yoram Gabison
Yoram Gabison
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An El Al plane takes off from Ben-Gurion Airport near Tel Aviv, March 10, 2020.
An El Al plane takes off from Ben-Gurion Airport near Tel Aviv, March 10, 2020.Credit: AP Photo/Ariel Schalit
Yoram Gabison
Yoram Gabison

She lost control of El Al Airlines, but Tami Mozes Borovitz isn’t ready to leave the airline business. On Sunday, she was one of six bidders offering to buy the much smaller carrier Israir for 57 million shekels ($17 million) in cash and bonds issued by her company Global Leasing.

Her bid was the lowest of the six. Rami Levy, the discount supermarket king, and his partner Shalom Haim offered to buy the airline for 92 million shekels in cash and shares in their publicly traded company BGI Investments. Moti Ben-Moshe, a German-Israeli entrepreneur, bid 100 million shekels through his company Dor Alon.

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The Sela and Friedson families, who were reportedly brought into the bidding by Koby Brot, an ex-pilots’ union official, offered to pay 80 million shekels in cash.

The top offer, which the bidders valued at 130 million shekels, was made by Arkia. Israel’s third airline, Arkia is controlled by the Nakash brothers, who propose to merge the two carriers and then take it public.

Rounding out the competition was Eduardo Elsztain, who had controlled IDB Development until it was wrested from him by creditors. Last week he offered to buy Israir for 90 million shekels as part of his plan to regain control of IDB’s sister company, Discount Investment Corp.

Mozes Borovitz lost control of El Al, Israel’s flag carrier, two months ago after the airline conducted a share offering to raise badly needed capital, enabling Eli Rozenberg, scion of a New York family in the nursing-home business, to amass a controlling 43% stake. Mozes Borovitz, who resisted the takeover, was diluted to just 15.2%.

If she wins control of Israir, she will be the boss of a much smaller airline. Israir’s fleet consists of three ATR-72 planes and four Airbus A-320s. It employs 413 people, of whom almost half are on unpaid leave due to the drop in air travel from the coronavirus. However, it is in better financial shape than El Al.

Attorney Ophir Naor, who was appointed by a court to sell Israir and other assets belonging to IDB Development to help repay some 990 million shekels in debt to bondholders. They are unlikely to be satisfied with the offers submitted on Sunday, but they are likely to be improved as the bidding process is winnowed down to the top two or three bids.

The Arkia bid faces additional obstacles. A merger would mean big job cuts that will be opposed by labor unions, while bondholders are likely to look askance at a merger that will have to clear antitrust approvals.

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