It emerged in the Magistrates Court last week that, according to the Israel Securities Authority (ISA), besides Bezeq Israeli Telecommunication Co. Ltd. (TASE: BEZQ) CEO Stella Handler and company secretary Liron Yochelman, who acted as "moles" and actively and systematically passed confidential documents to controlling shareholder Shaul Elovitch, there is another senior figure who was questioned in the affair but whose name may not be published. The investigators hold information indicating that he did not carry out his duties properly, to say the least, and thereby assisted in the transfer of information from Bezeq to Elovitch.
The ISA is investigating the interested party transaction in which Bezeq bought the shares in satellite broadcaster Yes held by Eurocom, a company controlled by Elovitch.
During the negotiations in the Bezeq-Yes deal, Gilad Rosolio of Bank of America Merrill Lynch, which advised Bezeq on the transaction, asked Bezeq managers how it was that they suspected that information was passing from their side to the other side in the negotiations, and yet they were doing nothing about it.
Rosolio was shocked by the behavior of the person mentioned above, and hoped that someone would take action, but this did not happen. Bezeq managers who attempted to warn about what was happening met a united front of the board of directors and the controlling shareholder blocking them from taking action against the person involved. This was the atmosphere in which the Bezeq-Yes deal took place. The person in question ought to have prevented Shaul Elovitch's son Or and Amikam Shorer, Bezeq's strategy and business development manager and a director, who was close to Elovitch, from conducting negotiations in which they had a clear conflict of interests.
At meetings between Bezeq, Yes and Eurocom, JP Morgan, which was advising the latter, revealed information that could only have reached it through leaks from Bezeq. Bezeq and Merrill Lynch were astonished at how, time after time, Eurocom obtained a substantial advantage in the negotiations, and warned the person whose job it was to put a stop to it, but nothing happened.
Published by Globes [online], Israel business news - www.globes-online.com - on July 16, 2017
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