Business in Brief: Leumi Asks to Boost Job Cuts by 300 to 700

Ex-Tnuva CEO to challenge big food makers | Tel Aviv shares rise as Wall Street hits high

People walk past a branch of Bank Leumi in Tel Aviv in this February 18, 2009 file photo.

Leumi asks to boost job cuts by 300 to 700

Bank Leumi in in talks with the bank of Israel’s supervisor of banks about increasing the number of job cuts to 1,000 from its originally planned 700, sources said on Wednesday The bank, Israel’s second-largest, is seeking to increase the number of layoffs after its initial offer to buy out employee contracts elicited hundreds of applications, more than 500 of which have already been approved.  The talks with banks supervisor y office are over accounting benefits Leumi is entitled to get from the Bank of Israel for making the job cuts and reducing costs and over how to account for severance costs without hurting its return on equity for the third quarter. The 700 layoffs are expected to cost the bank 400 million shekels ($103.7 million). Even if the banks supervisor doesn’t consent to 1,000 cuts, she is likely to approve a bigger quota changing the mix to allow older staff – defined as those hired before 1999 – to take offers over younger staff. Leumi shares finished 1.6% higher at 13.99 shekels. (Michael Rochvarger)

Ex-Tnuva CEO to challenge big food makers

Tnuva, Strauss Group, Osem and Israel’s other big food makers may be getting new competition from Aryeh Schor, the former Tnuva CEO, who wants to amalgamate small and medium-sized producers to better compete. TheMarker has learned the Schor plans to buy Pri Galil and turn it into a platform for buying all or part of other food makers whose revenues are stuck in the range of 50 million and 100 million shekels ($13 million-$26 million). By joining smaller food companies together, Schor hopes his platform can offer supermarkets a wider range of products. The aim is to help them increase their market share, win space of supermarket store shelves and produce private-label goods. Pri Galil’s owner, Zaki Shalom, is interested in selling the company and the accounting firm PWC is now conducting a valuation. Schor, who lost his job earlier this year as Tnuva’s sales plummeted, is being joined by another Tnuva veteran, Eyal Arad, the former sales chief. (Ora Coren)

Tel Aviv shares rise as Wall Street hits high

Tel Aviv shares rose gently on Wednesday in light trading as Wall Street hit a new record high and European shares advanced. The benchmark TA-25 index finished 0.6% up at 1,468.32 points, while the TA-100 gained 0.7% to 1,279.15, on turnover of just 961 million shekels ($249.2 million). Finance shares paced gains, with First international bank of Israel up 2% to 48.42 shekels and Israel Discount Bank ahead by 1.8% to 6.82. Harel led insurers on a 2.8% gain to 14.58. Leader Capital Markets said Tuesday that the banks would continue to enjoy high margins and little competition in small-business lending.  Colplant jumped 6.8% to 33 agorot while El Al Airline led Ta-100 stocks in heavy rtrading to add 4.5% and close at 2.81. But Elbit Systems dropped 0.2% to 366.20 despite news it was awarded contracts for $30 million to supply advanced thermal-imaging observation systems to an unnamed European country. Bezeq ended doewn 1/2% at 7.70 shekels. (Uri Tomer)