Employees of Elbit Systems Ltd. (Nasdaq: ESLT; TASE: ESLT) subsidiary Elisra Group claim that Elbit Systems president and CEO Joseph Ackerman is planning to restructure the unit. They also allege that he is threatening to close it down, unless they agree to the restructuring.
Elbit Systems acquired Elisra, which develops and manufactures electronic warfare systems, less than a year ago for $70 million.
Elisra employees claim that the planned merger between Bnei Brak-based Elisra and Holon-based subsidiary, Tadiran Spectralink Ltd., involves the laying off of 300 employees. The employees also claim that Ackerman told Histadrut chairman Ofer Eini, during a tour of Tadiran Spectralink last week, “The situation is bleak,” and added, “Elbit Systems will not invest a shekel in Elisra.”
In a conversation with “Globes”, Eini minimized Ackerman’s comments, saying, “He showed me Elisra’s balance sheet and its losses.” He added kiddingly, “This is not the first time that Ackerman has spoken about the need for streamlining. Managers always talk about streamlining. If I were given a shekel for each time a manager told me that, I’d be a rich man.”
Eini said streamlining plans were legitimate, but he has not yet personally reviewed the Elisra plan.
The main complaint by Elisra’s employees is the alleged threats by Elbit Systems’ management. “We’re told that if we fight the merger or oppose the switch to personal contracts, Elisra will be closed down,” they claim. “This is an empty threat, because a company with $300 million in orders isn't closed down so fast.”
The employees said they had recently agreed to the laying off of 100 veteran employees, of whom 70 had already left.
Published by Globes [online], Israel business news - www.globes.co.il - on October 29, 2006
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