Eliezer Fishman, who once numbered among the biggest of Israel’s tycoons, faced a growing threat of being forced into bankruptcy after Bank Hapoalim joined the Income Tax Authority in asking a court to name a receiver for his remaining assets.
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The tax agency filed a petition in Tel Aviv District Court two weeks ago, after Fishman failed to pay 196 million shekels ($51.6 million) in back taxes. On Tuesday, Bank Hapoalim, to which Fishman owed 1.8 billion shekels, followed suit in turning to the court.
In its petition, the bank said it wasn’t prepared to act on its collateral rights and in any event did not expect to recover anything close to the full 1.8 billion shekels.
“The bank’s rough and nonbinding estimate is that the value of the collateral is only sufficient to repay a relatively small part if the debt,” Hapoalim told the court.
“Given that the snowball has begun rolling, the bank — as almost certainly Fishman’s biggest creditor with 1.8 billion shekels — regards it as critically important that the honorable court include it as part of the process and appoint administrators in its name.”
It asked that lawyers Pini Rubin and Yaron Elhawi be appointed as special administrators, now or after a previously scheduled hearing on September 29.
The court is due to discuss the petition August 25.
Fishman is estimated to have more than 4 billion shekels in personal debt and has for quite some time been unable to service it. His estimated debt to Bank Leumi is also around 1.8 billion shekels.
Leumi acted in March to take over Fishman’s 40% stake in his flagship property company, Jerusalem Economy Corporation, which yielded it about 200 million shekels. Leumi’s own special administrators, lawyers Eyal Rosovsky and Ronen Matry, have been working to sell off additional Fishman assets, mainly real estate worth hundreds of millions of shekels.
The bank has not yet touched the financial daily Globes, a key Fishman asset it holds as collateral, but sources told TheMarker that by the end of the year it might to turn to the courts to force a sale.
Fishman has so far refused to entertain offers for the newspaper, which in years past he has valued at $100 million. He shares control of the daily with the family of Globe’s late founder Haim Bar-On.
Unlike Leumi, Hapoalim has not taken any operative steps to recover its share of the Fishman debt. The new policy may represent a changing of the guard at the bank, Israel’s largest, after Arik Pinto succeeded Zion Kenan this month as the CEO of Hapoalim.
Last Tuesday the bank warned Fishman in a letter that he must repay the debt, which he ran up a personal guarantor for loans he took out for his companies.
Among the assets for which Hapoalim holds collateral are Fishman’s stake in the Yedioth Aharonoth publishing group, the retailer and filling station company Ten, the Home Center home improvement chain of stores and properties.
Nati Tucker contributed to this report.