Antitrust Authority raids Tnuva’s offices

Chairwoman Zehavit Cohen and CEO Arik Shor were to be questioned on suspicion of not providing full information requested.

Tnuva milk bags 298.88 (photo credit: Ariel Jerozolimski)
Tnuva milk bags 298.88
(photo credit: Ariel Jerozolimski)
The Antitrust Authority has opened an investigation against Tnuva Food Industries. Chairwoman Zehavit Cohen and CEO Arik Shor were to be questioned Sunday on suspicion of not providing full information requested. Not providing information or concealing information requested by the Antitrust Authority are criminal acts.
Antitrust Authority investigators raided Tnuva’s offices Sunday morning.
As part of the authority’s investigation into the dairy market, it asked Tnuva and other dairy companies for information. Tnuva provided information, but the authority concluded that Tnuva was concealing information and that it had not provided everything demanded. Antitrust Authority investigators confiscated documents and apparently intend to question senior Tnuva executives under caution.
Also Sunday, Tel Aviv District Court Judge Avi Zamir opened a hearing on a petition by Tnuva shareholder Mivtach Shamir Holdings to open Tnuva’s books. The case comes two months after the collapse of the sale of Mivtach Shamir’s Tnuva stake to Bank Leumi unit Leumi Partners.
Mivtach Shamir owns 20.7 percent of Tnuva through 27% of a special purpose vehicle; Apax Partners owns the other 73%, giving it a 56.1% stake in Tnuva. Kibbutzim own the remaining 23.3%. Mivtach Shamir was asking NIS 775 million for its holding.
Until Mivtach Shamir sells its Tnuva holding, its shares are blocked from trading on the Tel Aviv Stock Exchange, after the Israel Securities Authority suspended trading in May 2010 because of the non-disclosure of Tnuva’s financial reports. The Security Authority states that the Tnuva holding is a material holding of Mivtach Shamir, which must therefore publish Tnuva’s results.
Apax Partners Israel, a private equity fund, refuses to disclose information about its investments.

Asked by Apax’s attorney whether he had agreed not to disclose Tnuva’s financial reports, except in case of an IPO, Mivtach Shamir CEO Meir Shamir said, “Yes.”
He added, “Obviously, it is important to Apax that Tnuva’s financial reports are not published, but that is of no importance to Mivtach Shamir. [Apax Israel CEO] Zehavit Cohen said at the time that Apax was a private equity fund, which was why it wanted to keep this information confidential.”
Shamir said that Apax had threatened to sue Mivtach Shamir. “We did everything we could to solve this problem, when we were threatened that if we demanded a solution that involved disclose of the information, we’d be sued.”