The storm surrounding the resignation of Apax Partners Israel CEO Zehavit Cohen as chairwoman of Psagot Investment House Ltd. and Tnuva Food Industries Ltd. is refusing to die down. Sources inform "Globes" that Cohen's resignation announcement on Sunday "came from upstairs" - directly from Apax Partners management overseas and was not Cohen's own initiative to quell criticism of Tnuva.
Sources close to Apax Partners that have followed the fund's activities in Israel over many years today told "Globes" that Cohen's bosses made it clear to her that she was expected to resign. The source said, "Apax thought it was time for her to go. It wasn't that she herself volunteered to resign." However, the source added that Cohen was not surprised at the dictate and did not oppose it. "She did not fight over the position. She felt that she had reached the point of no return."
The demand by Apax Partners management came in the wake of the investigation by the Israel Antitrust Authority against Tnuva for allegedly concealing the McKinsey document which "Globes" had exposed. As part of this investigation, Cohen was questioned under caution last week.
The source told "Globes," "For Apax the antitrust investigation was a watershed. While it was only a matter of social protests she was not asked to step down." Following the investigation, Apax felt it had no choice but to ask her to leave because of its policy of "zero tolerance" regarding criminal investigations. This was a policy it had stated unequivocally during the suspicions against former Psagot Investment House Ltd. CEO Roy Vermus.
The source said, "Apax has always taken the view that if there is any doubt, then there is a doubt, and if a person is being investigated then he cannot carry on. It would be impossible to say that they were satisfied in any way, shape or form with her recent conduct but in real time they gave her enough rope because that is also their policy that the boss should be allowed to be the boss."
The source continued, "From July until the Antitrust Authority opened its investigation they gave Cohen enormous credit in order to handle the crisis caused by the protests. But in the end the results were terrible."
Market sources believe that the damage to Tnuva will be long term and consequently the planned exit by Apax Partners will be cancelled.
Published by Globes, Israel business news - www.globes-online.com - on October 3, 2011
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