"We'll take over IDB Development if the company's debt settlement does not meet the criteria of fair management of the public's money," Psagot Investment House Ltd. CEO Hagai Badash said at the Association of Insurance Brokers and Agents conference in Eilat yesterday. "Just like the banks foreclose on homes of bankrupts who cannot pay their mortgages, we won't let Nochi Dankner take the public's money."
Badash said, "It is unacceptable that if we don’t pay a mortgage of a few hundred thousand shekels, our homes are seized, but if a company fails to repay billions in debts, the debt is deferred time and again, and ultimately forgiven, partly written off, and the same controlling shareholder stays in control. The time has come for the equation to be overturned: if someone cannot meet his debts, we will use every means, including seizing the company by the debt holders."
Badash reiterated past remarks, saying, "A company and its controlling shareholder, which have a problematic history with the rights of public money, we at Psagot won't invest in it." Commenting on write-offs, he said, "The axiom that debts must be repaid has frayed lately. This phenomenon should be uprooted from the Israeli capital market."
As for the petition by IDB Development Corporation's bondholders representative for an imposed debt settlement, in which the company's creditors will take it over, Badash said, "The court proceedings create a positive precedent in the Israeli capital market, which will change the rules of the game for handling debt settlements and write-offs, and will create new and fair norms for the management of the public's money in Israel."
IDB Development said in response, "The cat is out of the bag. Badash has finally shown that his goal is to take over the excellent assets of IDB Development, a company which has NIS 1.1 billion in cash and meets all its commitments. Regrettably, after we have already seen Badash's populism, it is no surprise that he is trying to ride the current wave to try and achieve his objective - a takeover of the company's assets."
Published by Globes [online], Israel business news - www.globes-online.com - on April 25, 2013
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