Conditions for Prime Catering Not So Choice

Over the weekend, the struggling Prime banquet facility in Tel Aviv's Hayarkon Park was invaded by suppliers, who came to remove equipment they own from the premises. CEO Nissim Bin-Nun, accompanied by a bodyguard, was there at the time. Yochai Peleg, the owner of the business that owes a large debt, fled Israel on Tuesday.

Dan Werner, chairman of the Morag Group, which operates a large number of food and beverage businesses, was reportedly asked to purchase Prime. The Morag Group's properties include catering and food service businesses in Hayarkon Park, Memadion Water Park and the Yamit 2000 Water Park, as well as the Green Villa-Tel Aviv near the Tel-Aviv University campus in Ramat Aviv. Werner is also a part owner of the Sbarro Italian fast-food chain in Israel, in which Peleg had formerly been a partner.

Bin-Nun yesterday confirmed that he and Werner were negotiating over an agreement, but the CEO of Prime also said he was conducting talks with another interested party. "There are two separate negotiations that are at an advanced stage, but there's still time until the money comes in," Bin-Nun said.

A source in the banking field said that Peleg owes between NIS 20 million and NIS 40 million to Israel Discount Bank as well as NIS 10 million to Bank Leumi. The source said that the banquet company was financially solid until about a year ago, when it got into trouble. He said the problem was not with the banks, hinting at loans on the gray market.

Bin-Nun's main worry is that a receiver will be appointed immediately. He hopes to find a potential investor who could keep the business running, presumably with temporary protection from creditors extended by the court. Afterward, when a receiver is named, it will be in the interest of all parties for the investor to become the new owner.

"If a receiver is appointed soon, he won't be able to hold events as usual," Bin-Nun said.