A delegation of Israeli bankers is meeting with officials of Bankers Trust Co. here in an attempt to save the giant Histadrut-owned Koor Industries of Israel from liquidation to satisfy an unpaid debt.
Talks began Wednesday at Bankers Trust headquarters in Manhattan and are continuing.
Tom Parisi, senior vice president for communications at Bankers Trust, told the Jewish Telegraphic Agency he was not familiar with the details of a plan worked out by the Israeli government and the leading banks to save Koor.
He said a statement was to be issued late Thursday.
Koor, a vast conglomerate in deep financial difficulties recently, owes Bankers Trust $150 million.
It defaulted on a $20 million payment due earlier this month and the New York bank, its largest overseas creditor, petitioned a Tel Aviv district court for relief.
According to reports from Tel Aviv Thursday, senior officials of Koor are confident they can persuade Bankers Trust to accept Israel government securities in lieu of the money owed it.
In addition, the government proposes an infusion of tens of millions of dollars into Koor in exchange for a stake in the company, now wholly owned by the trades union federation.
Koor, which employs nearly 30,000 workers, is said to account for some 10 percent of Israel’s gross national product and a large share of its exports. Its collapse would be an economic disaster for Israel.
Premier Yitzhak Shamir, whose Likud bloc is in the midst of a fierce election campaign against the Labor Party, holds no brief for Koor. Its parent, Histadrut, is Labor-dominated.
But Shamir nevertheless has stressed that the country cannot allow Koor to go under.
A statement issued by Bankers Trust here Wednesday said: “Bankers Trust Co., Koor Industries Ltd. and Koor’s Israeli banks met today to resolve the issues between them.
“The parties intend to work diligently and expeditiously to resolve the open issues in their continuing discussions.”
Koor’s managing director, Benny Gaon, its attorney, Ram Caspi, and Eitan Berglas, chairman of the Bank Hapoalim, Koor’s largest creditor in Israel, are participating in the negotiations here.
(JTA correspondent Hugh Orgel in Tel Aviv contributed to this report.)
The Archive of the Jewish Telegraphic Agency includes articles published from 1923 to 2008. Archive stories reflect the journalistic standards and practices of the time they were published.
