Jordanian lifeline for Negev Ceramics

Negev Ceramics Photo: Eyal Yitzhar

Businessman Moshe Sabah who is leading a consortium: Money for Negev Ceramics acquisition will come from a Jordanian investor.

Is the crisis at Negev Ceramics nearing a solution? According to businessperson Moshe Sabah, who represents a group of Israel investors and a Jordanian investor, the employees of the plant, controlled by Viola Credit, have reasons for optimism. "Within three or four days, we can reach a situation in which an agreement for the purchase of the factory at a cost of NIS 150-160 million from Negev Ceramics is signed," Sabah told "Globes".

Sabah said that if the deal eventually goes through, the plant will employ 75 of its 138 workers, and will be able to compete in production directly with products currently imported from Turkey. "Today, we obtained the bank account number of Mivne (owner of the building in which the plant operates in Yeruham, Y. A.), and the Jordanian investor will make a bank transfer in the coming days of the full amount necessary to transfer the existing contract between Mivne and Viola Credit," Sabah said.

Viola Credit's lease with Mivne has so far made it difficult for Udi Levy, owner of the Atzmaut sewing shop, who is trying to acquire the plant, to make a deal to save it from closing down. He is having trouble producing the guarantees provided by Viola Credit. "Viola will be completely free of the agreement with Mivne, and we will take it on. It includes NIS 8 million in guarantees, one year's rent, on a multi-year format, plus an agreement for the plant's machinery and the obligations that we are being required to take upon ourselves. We are just a signature away," says Sabah, a Likud activist in Ashkelon, one of those involved finding a solution to the crisis in Yeruham. He says that the Israeli investors he is representing in the deal work in real estate, while the Jordanian investor is interested in Negev Ceramics, and in opening stores to sell its products in Amman and Aqaba. He nevertheless absolutely refuses to reveal their identity, saying, "When we close the deal, everything will be revealed. We will of course sell to everyone, and the Negev group has also expressed willingness to buy from the plant in Yeruham for its chain of stores throughout Israel. We have obtained all of the necessary figures for the plant in Yeruham from Viola's management."

Negev Ceramics was acquired from Africa-Israel Industries Ltd. (TASE: AFID) in the middle of last year by Viola Credit. Last November, Negev Ceramics' management announced the closure of the plant in Yeruham, citing production costs higher than those of the products imported from Turkey, and saying that there was no reason for the plant to exist. The group's management also said that even when the plant was producing, over 80% of the products sold in its chain of stores were imported. The period in which the group's management was obligated to pay wages to the plant's 138 workers expired last week, and the workers were left without their livelihood. Next Thursday, the National Labor Tribunal will hold another hearing on the crisis in Yeruham in an attempt to have the plant sold to either Levy or the group of investors represented by Sabah.

Published by Globes [online], Israel Business News - - on March 6, 2018

© Copyright of Globes Publisher Itonut (1983) Ltd. 2018

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Negev Ceramics Photo: Eyal Yitzhar
Negev Ceramics Photo: Eyal Yitzhar
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