bezeq logo 88 224.
(photo credit: )
The board of directors of Bezeq Israeli Telecommunication Co. Ltd., controlled
by Shaul Elovitch, on Sunday approved an unprecedented dividend of NIS 3 billion
and a reduction in shareholders’ equity.
Half of the dividend will
reportedly be used to buy back shares in the company. In 2007, under Bezeq’s
previous controlling shareholders, Ap- Sab-Ar Holdings Ltd. (the Apax
Partners-Saban Capital Group Inc.-Arkin consortium), the company distributed a
NIS 1.8b. dividend, which also resulted in a reduction in shareholders’
Bezeq employees are deeply concerned about the reduction in
shareholders’ equity, according to information obtained by Globes. The
distribution will require prior approval of the two investment banks, which will
have to state that they are unconcerned about Bezeq’s financial soundness and
that its credit rating will not fall below AA2.
Paralleling the reduction
in shareholders’ equity, Bezeq management, its workers committee and the
Histadrut Labor Federation are expected to sign an extension to the company’s
collective labor contract. The new contract will include linkage to public
sector salaries through 2015, an option to extend for two more years, and extend
the current retirement agreements and retirement with increased benefits
Bezeq employees will also receive options for 70 million
shares at a discount or benefit of more than NIS 250 million, and a NIS 50m.
bonus, to be paid in two equal installments in January 2011 and January 2012.
Bezeq’s management also agreed to give tenure to more than 600 employees over
the next two years.