The investigation of the merger between DBS Satellite Services (1998) Ltd. (YES) and Bezeq Israeli Telecommunication Co. Ltd. (TASE: BEZQ) will continue in the coming days with the questioning of additional figures in the case.
New information revealed today shows that Yes CEO Ron Eilon received a special NIS 1-2 million bonus for the merger between Yes and Bezeq. The bonus was not reported to the TASE or investors. In order to avoid reporting the bonus, Yes gave it to Eilon as a special bonus in the first quarter of 2015. Since Bezeq consolidated Yes only starting in the second quarter of that year, no information about the bonus was reported. In effect, Eilon could receive bonuses with almost no restriction up until the second quarter of 2015 without Bezeq having to report them.
Eilon's special bonus was given by Yes, but it is important to keep in mind who the members of the Yes board of directors who approved the bonus were: Bezeq controlling shareholder Shaul Elovitch; Or Elovitch, Shaul's son; and Amikam Shorer, Shaul Elovitch's deputy were all directors representing Bezeq in Yes. Eilon later received bonuses that were reported, with a large component related to Yes's cash flow.
On Friday, Advocate Linor Yochelman, Bezeq company secretary and Elovitch's right hand, was questioned by the Israel Securities Authority on suspicion of having coordinated the transfer of information to Elovitch at all stages of the negotiations in the Bezeq-Yes deal.
Yochelman is regarded as a very close associate of Elovitch. In recent years, she has been promoted at Bezeq to VP and has received bonuses and pay raises. She was also recently appointed the company's legal advisor.
Bezeq notified the TASE on Friday that the investigation of its senior company executives and those of Yes was continuing in the framework of the Bezeq-Yes deal. It is unclear who the additional figures to be questioned are, but the list is likely to include both officeholders and directors in the two companies. As far as is known, some of the directors have sought legal counseling in addition to the legal advice they are receiving as directors. Bezeq has hired the services of the Herzog, Fox, & Neeman law firm in the case.
Yochelman is unquestionably a leading figure in the Yes-Bezeq deal. Senior Bezeq executives swore that they heard Elovitch say that he trusted Yochelman like a daughter. The absolute faith of Bezeq's controlling shareholder in Yochelman is the result of close work for many years on extremely sensitive matters. Yochelman's great disadvantage is probably her tendency to brag on the subject. Many people in Bezeq frequently hear about the special tasks entrusted to her by the company's controlling shareholder.
When Bezeq was waiting for the prime minister to approve the Yes deal, Yochelman said that there was nothing to be worried about, because Sara (Netanyahu) had promised Iris (Elovitch's wife) at a social evening of the two couples that approval would be forthcoming soon. It is unclear whether this was boasting, or whether a promise had really been made, but it indicates how Yochelman behaved. It is difficult to find a more controversial person at Bezeq than Yochelman.
Yochelman was secretary of the special committee in the Yes-Bezeq deal, but she was actually the liaison between Elovitch and Eurocom Group personnel and the committee members. She was responsible for documenting the committee's work, and the fragmented minutes of the committee's work are her doing.
In the Yes-Bezeq deal, Bezeq employees mentioned the many hours she spent with Elovitch and people from Eurocom, frequently in Eurocom's offices. The feeling among Bezeq managers knowledgeable about the deal was that all the information was going freely to Eurocom.
The decision by Securities Authority investigators to question Yochelman already at this stage shows her importance in the affair. Yochelman has a great deal of about the conduct of Elovitch and the special board of directors committee. If the investigators succeed in extracting information from her about these matters, explosive developments in the affair are likely.
Published by Globes [online], Israel Business News - www.globes-online.com - on June 25, 2017
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