From Plant to Empire
Eurocom was originally a plant for making telephones, owned by real estate company Mivnei Gazit. The idea belonged to Aryeh Berg, who owned a company called Datacom, and was a partner with Tadiran in a telephone plant in Iran during the Shah's reign. With the Ayatollah Khomeini's rise to power in 1979, Berg escaped from Iran with some of the molds, and set up Eurocom together with some foreign investors. His share was 10%. Mivnei Gazit acquired the plant from Berg and his partners, and kept him on for four years. The manager was Yehiel Matalon.
Shaul Alovitz, almost 52, started his career in communications at the age of 21, when he married Mira, whose father owned RAP, a communications products marketing company. Alovitz entered the company in 1970 and headed it for fifteen years. At first he simultaneously studied law, but left in his third year to devote himself to managing RAP. Among other things, he was a distributor of Eurocom products, and thereby got acquainted with the company.
In 1985, Alovitz left RAP and acquired Eurocom. His brother Yossi, RAP head engineer, joined him at Eurocom as vice president for finance. Aryeh Berg became his assistant, responsible for business development. Manager Yehiel Matalon was sent to Japan to learn about Panasonic products, and later appointed service manager of Eurocom.
The Eurocom plant and real estate was purchased in 1985 for several hundred thousands of dollars. Today, the company is worth many hundreds of millions of dollars. The next step was to set up Eurocom Industries, and under it, Eurocom Marketing, which received exclusivity for Panasonic products. At a later stage came the setting up of Nokia Cellular Communications, which markets Comdial exchanges in Israel, with Euronet, Internet Gold, Partner, and IP Planet joining it. Alovitz's most recent investment in Israel is in YES Satellite Broadcasts, in which he is about to increase his stake to 30%.
At a certain point, Alovitz brought an important strategic and financial partner into Eurocom - Ted Arison. Arison Investments currently constitutes an almost equal partner in Eurocom, even after the death of Ted Arison. The major project the company is dealing with today is Eurocom 21, a venture likely to set up the inland communications network which will compete with Bezeq.
What has characterized Alovitz during the past year is the eyeing of activities outside Israel. He is doing this through an investment in Internet Gold in Greece, and through contacts in other countries, with the founding of IP Planet, which provides broadband satellite communications services to Internet companies worldwide, via subsidiary Trio. The subsidiary is expected to provide, on the same infrastructure, interactive television and Eurocom 21 project services in Israel and overseas.
Alovitz, as he appears now, is no longer only a trader in end-user equipment, but a dominant factor in the communications operations market in Israel and in Israeli communications operations overseas.
Published by Israel's Business Arena on December 16, 1999
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