Tnuva chairwoman Cohen resigns over antitrust probe

Tnuva officials reportedly say decision took them by surprise; Company announces lower prices for dozens of its dairy products.

By NADAV SHEMER
October 3, 2011 00:34
3 minute read.
Tnuva chairwoman Cohen resigns over antitrust probe

Tnuva milk bags 298.88. (photo credit: Ariel Jerozolimski)

 
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Apax Partners Israel CEO Zehavit Cohen resigned from her positions as chairwoman of Tnuva Food Industries and Psagot Investment House on Sunday, as Tnuva announced it will lower the prices of dozens of dairy products.

The double resignation came one week after the Israel Antitrust Authority opened an investigation into Tnuva on suspicion the company was not providing information requested by the authority as part of a separate investigation into the dairy market. Withholding or concealing information from the Antitrust Authority is a criminal offense.

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Channel 2 reported Tnuva officials as saying there had been no pressure on Cohen to resign, and the decision took them by surprise.

Cohen said in a statement, “I made this decision to ensure that each company has a fulltime chairperson who devotes all their time to the company while focusing on growth in light of the changing economic environment. As I have stated in the past, an investment house must act unexceptionably, and so I have decided to resign from all of my positions at Psagot until the Antitrust Authority completes its investigation into Tnuva.

“Tnuva will continue to cooperate fully with the Antitrust Authority in the hope that the investigation will soon be completed, and that it will prove that Tnuva and its management acted properly. This step will enable me to focus on my position as Apax Israel CEO and to search for new investments, while remaining involved in the advancement of Tnuva’s business interests.”

Cohen will retain her position on Tnuva’s board of directors and will continue to manage Apax Partners, which owns Tnuva and Psagot. Former Bezeq Telecommunication chairman Shlomo Rodev replaces Cohen as Tnuva chairman, while Ron Gutler becomes acting Psagot chairman until the board finds a permanent replacement.

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On the same day as Cohen’s resignation, Tnuva announced it will lower the prices of dozens of selected dairy products by 15 percent starting on Tuesday. Company representatives said the price reduction was made possible by a decrease in the cost of milk. Rival Strauss followed suit later in the day, announcing it would lower the prices of selected dairy products by up to 12%.

One of the leaders of a protest campaign targeting Tnuva called Sunday’s announcements “proof that the consumer boycott of the company has worked.”

Tel Aviv Student Union chairman Uri Reshtik told Israel Radio the price reduction was a good start, but the consumer boycott would continue this week.

Tnuva has been the subject of various consumer campaigns since June, when a nationwide boycott of cottage cheese was launched to protest rising prices.

Tnuva CEO Arik Schor said on Army Radio that the price reduction shows that “instead of talking about internalizing ideas, we have reduced the prices of basic products.”

Schor said, “There is no doubt that the cost of living protests have affected us too... We are trying to cut the cost of living in Israel and that is not a trivial matter. We have been thinking about how to provide Israeli consumers with our products in the best way possible, and how to find a longterm solution.”

Schor also promised that Tnuva will publish its full financial report this week, to resolve an ongoing dispute with minority shareholder Mivtach Shamir Holdings. Mivtach, which owns 20.7% of Tnuva, was suspended from trading on the Tel Aviv Stock Exchange in May 2010 because of the non-disclosure of Tnuva’s financial reports.

Jerusalem Post staff contributed to this report.

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