Bezeq CEO to step down July 1 amid Netanyahu-related probe

CEO Stella Handler was arrested in February on suspicion of bribery, fraud, breach of trust and other securities offenses

By
March 19, 2018 17:22
2 minute read.
The logo of Bezeq Israeli Telecommunication Corp Ltd, the country's largest telecom group, is seen.

The logo of Bezeq Israeli Telecommunication Corp Ltd, the country's largest telecom group, is seen outside their headquarters in Tel Aviv, Israel June 21, 2017.. (photo credit: REUTERS/AMIR COHEN)

Israel’s largest telecom company, Bezeq, announced on Monday that its CEO, Stella Handler, would formally step down on July 1, amid an ongoing police investigation involving aides to Prime Minister Benjamin Netanyahu.

Last month, Bezeq named Yaakov Paz as interim CEO to replace Handler – who was at the time under house arrest – while she and other Bezeq executives were being investigated by the police and the Israel Securities Authority.

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Handler was arrested in February on suspicion of bribery, fraud, breach of trust and other securities offenses. She was released by a judge on the condition that she be barred from the Bezeq premises for a month.

“After completing a five-year term at Bezeq and having the ownership of the company be changed, and in light of the investigations and the circumstances, I’ve decided to resign from my position,” Handler said in a corporate statement. “This is the right thing to do, both on a personal level and for Bezeq.”

As Bezeq’s CEO since 2013, Handler oversaw Bezeq’s installation of high-speed, fiber-optic cables in the center of the country. The company plans to expand that infrastructure to the periphery.

Handler also led the company’s acquisition of satellite TV unit Yes in 2015. Bezeq had sought to acquire Yes in order to bundle cable TV, phone and Internet services – allowing the company to compete with its rival HOT.

Bezeq acquired Yes from Eurocom – a company controlled by brothers Shaul and Yosef Elovitch. The Elovitches are also major shareholders in Bezeq. That raised questions of a conflict of interest and led to a police probe.

In Case 4000, what has been dubbed the Bezeq-media case, the prime minister is alleged to have ordered top aide Shlomo Filber – who he appointed as director-general of the Communications Ministry – to issue favorable rulings for Bezeq. That reportedly included getting anti-trust regulators to approve Bezeq’s merger with Yes.

Bezeq’s news site – Walla! – has been accused of exchanging that favor for giving positive coverage to Netanyahu and his wife, with the prime minister’s aide Nir Hefetz managing the contact. Hefetz has become a state witness and is testifying against his former boss.

Shaul Elovitch, the owner of Walla! and controlling shareholder and former chairman of Bezeq, is said to have coordinated the coverage.

Elovitch – a friend of the prime minister – was arrested along with Handler and other Bezeq officials. He has stepped down from the board, acquiescing to demands from shareholders amid the criminal probes.

In separate developments, a battle has been brewing for weeks over who will be appointed to Bezeq’s board of directors. Activist investor fund Elliott Advisors has publicly spoken out against names proposed by the Bezeq parent company, signaling a struggle over the firm’s direction.

In January, Elliott Advisors demanded the immediate resignation of some members of Bezeq’s board, in a call for corporate governance reform.

Bezeq’s interim CEO, Paz, has worked at the company for the past 11 years. He was previously vice president and head of the utility’s business division.


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