Israel Land Development Company (TASE: ILDC), controlled by Ofer Nimrodi, will not invest any capital in Ma'ariv Holdings Ltd. (TASE: MARV), the publisher of Hebrew daily "Ma'ariv", at this time. Sources inform ''Globes'' that Israel Land is leaving the current crisis mainly in the hands of Ma'ariv's new chairman, Zaki Rakib, and expressed its support for measures that the market calls "drastic" to save Ma'ariv's cash flow, and which do not involve a capital injection into the company.

The sources add that Israel Land plans to take a more active role in the conversion of bonds, if that is done, to cover Ma'ariv's debt. If a rights issue is decided upon, i.e. a capital injection into Ma'ariv, Israel Land will leave the stage completely to Rakib.

The sources say that Ma'ariv's board of directors has given Rakib support to make deep cuts, including the axing of scores of employees, pay cuts, and the reduction of printing costs, probably by reducing the number of pages in the paper. Company officers told Rakib that this was the time to make fundamental changes to change the paper's cash flow.

During April, Rakib is expected to announce major measures at Ma'ariv, including consolidating the business supplement and magazine into the news pages, and reducing the size of magazines in the Friday edition. At the same time, emphasis will be placed on the new media.

A source at the paper said, "We're heading for streamlining measures at every level of the company, including personnel and printing costs. Zaki is planning measures for renewal and will reveal his strategy in April or early May."

Last year, Rakib invested $15 million in Ma'ariv for 30% of the publishing company and effective control of it.

Rakib, Ma'ariv, and Israel Land declined to comment.

Published by Globes [online], Israel business news - www.globes-online.com - on March 9, 2011

© Copyright of Globes Publisher Itonut (1983) Ltd. 2011