Search JTA's historical archive dating back to 1923

Koor Conglomerate May Go Under Unless It Gets Immediate Bailout

December 20, 1989
See Original Daily Bulletin From This Date

The mammoth Histadrut-owned Koor Industries has sent an SOS to the government.

It is foundering in a sea of debt, and unless it gets immediate help in the form of a government bailout, it is likely to go down by the end of this month, taking 11,000 jobs with it.

That was the message delivered to Finance Minister Shimon Peres and the Knesset’s Economic Committee this week by Benny Gaon, Koor’s chief executive officer, and by other officials of the conglomerate.

Although the precise figures were not made available, Koor is seeking new loan write-offs and deferrals in the amount of $120 million to $160 million.

They would be on top of the $120 million of loans deferred earlier this year, to which Koor’s overseas creditors agreed reluctantly after the Israeli banks went along.

The new concessions can be obtained only if the government guarantees the loans. But Peres and his aides are demanding detailed figures and a new recovery plan from Gaon before committing the Treasury.

Peres has said publicly that his primary concern is for the future of the 11,000 people employed in the many Koor enterprises. The largest of them is Tadiran, a huge manufacturer of electronics and communications equipment, which is badly strapped for cash.

Gaon has been trying to sell it, so far without success. But he has sold several other Koor businesses in the past year and imposed severe austerity measures on others.

He has gotten high marks from Histadrut Secretary-General Yisrael Kessar, who issued a strong statement of confidence in Gaon Monday.

Recommended from JTA