The agreement the Defense Ministry and Israel Military Industries signed on
Wednesday by, marking the privatization of the defense corporation, is designed
above all to ensure that vital arms production lines remain in
The accord, signed by Defense Ministry director-general,
Maj.-Gen. (res.) Dan Harel, was already finalized several weeks ago, and has
committed the ministry to purchasing NIS 550 million of arms from IMI every
year, thereby ensuring that the ailing firm can survive and pay salaries to
Some 900 employees will still end up losing their jobs.
years of negotiations have led to this arrangement, which ensures that Israel
will continue to produce its own strategic arms, particularly shells and
mortars. Underlining the agreement is the defense establishment’s understanding
that it cannot rely on any outside party to deliver such weapons at a time of
Had the agreement not been signed, Israel would have lost
the ability to produce these weapons. Hence, despite the agreement not being the
most financially efficient of options, it reached the signature stage on
Additionally, IMI produces classified strategic defense
products that are considered absolutely vital to state security.
section of the company that manufactures these products will be split from the
rest of the firm, and turned into a state company, operating under the Defense
The privatization of IMI will see the company move from its
current headquarters in Ramat Hasharon to Ramat Beka, south of Beersheba,
clearing the way for the construction of 44,000 housing units. Defense sources
have expressed hope that the newly available land will contribute to lowering
housing prices in the area.