Israeli Court Gives Fallen Tycoon and Creditors a Month to Reach Plan for Selling His Assets

After tense hearing, Judge Eitan Orenstein tells sides to try to work out arrangement on Eliezer Fishman's $1.1 billion in debts.

Eliezer Fishman in a Tel Aviv courtroom, March 23, 2017.
Ofer Vaknin

Eliezer Fishman, the fallen tycoon with debts estimated at 4 billion shekels ($1.1 billion), avoided being formally declared bankrupt on Thursday, after Tel Aviv District Court Judge Eitan Orenstein gave him and his creditors a month to agree on a plan for selling his assets.

The decision came as the parties to the dispute clashed in court over whether Fishman should be formally declared bankrupt. Yossi Benkel, the special administrator appointed by the court, as well as the Israel Tax Authority, are in favor, while Fishman is resisting it and is being quietly supported by his bank creditors.

After hearing accusations and counteraccusations — including particularly bitter ones from Benkel concerning Fishman and his adult children — Orenstein urged the sides to reach a compromise.

“We need to lower the flame — you’re all acting too extreme and that’s not good,” Orenstein said. “It is certainly possible to reach understands and agreements. You don’t need to fight to win. Sometimes I look on motions being filed and I say, ‘There’s no reason.’”

Fishman’s creditor banks, who are owed the lion’s share of his debt, are reportedly concerned that declaring him bankrupt would hurt the businesses he still controls and reduce the value of the shares in them they hold as collateral.

The banks have taken a low profile in the case, but Fishman attorney Shalom Goldblatt told the court Thursday they were strongly opposed to bankruptcy but feared saying so in public. “The media exposure and the harsh criticism of the banks in the press has created a situation where the banks are stepping back,” he said.

Orenstein said he was surprised. “Do you want to say that their considerations are businesslike?” They’re saying one thing [in private] and saying something else here in the court?”

Benkel has had unusually tense relations with the Fishman family since he was appointed special administrator. He has accused the family of trying to rearrange their holdings to keep them out of the hands of creditors and of refusing to cooperate with his investigation into their holdings.

Before his assets were put into receivership last year, Fishman controlled a corporate and real estate empire under the rubric of the Fishman Group and was one of Israel’s most powerful tycoons.

The sparks between Benkel and Fishman flew again on Thursday in Orenstein’s courtroom, as Benkel claimed the family was frustrating his efforts to identify their assets. Fishman was present in court with his two daughters, Anat Fishman-Menipazn and Ronit Fishman-Ofir.

“He and his children are waging a war of attrition against me,” Benkel said. “I’ve wasted long hours being harassed by [Fishman] and his children in my attempts to get an answer to one question: What is the Fishman Group? When I reminded Fishman that he was the one who used this term, he got up and tried to leave the room and said I was insulting him.”

Benkel said that even though that 95% of Fishman’s debt is connected with the group, the group companies refuse to provide information:”They say I don’t understand anything about the assets. And that’s certainly true — because they prevent from getting information,” Benkel said

Goldblatt responded that Benkel was undermining what remains of the group and accused him of rejecting out of hand an agreement on Fishman’s debt and in favor of pursuing the bankruptcy route.