Buyout saves Pri Galil workers' jobs

Company to be bought by Hatzi Hinam supermarket chain; elsewhere, Comverse to fire hundreds.

By JPOST.COM STAFF
March 4, 2009 10:27
2 minute read.
Buyout saves Pri Galil workers' jobs

pri galil protest 248 88. (photo credit: Channel 2)

 
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The employees of financially-stricken Vita Pri Galil on Wednesday met with bank representatives and were told that the Hatzor Haglilit factory would not be closed and that they would be able to keep their jobs. According to an agreement, which was signed later Wednesday, Pri Galil will be bought by the Hatzi Hinam supermarket chain, which promised to keep the factory active and hold on to the workers. The meeting was attended by Histadrut Labor Federation head Ofer Eini and his team of mediators, as well as the CEOs of Discount Bank and Bank Leumi. The representatives of the workers were apprised of the details of the Hatzi Hinam offer. The banks promised to cover the financial obligations stemming from employees' wage agreements and pension plans and said that the buyer had guaranteed to uphold the current salary contracts. The owners of Vita Pri Galil owe Bank Leumi and Bank Discount NIS 120 million due to debts incurred by the two additional companies under their ownership. The debt mounted despite the strong production performance of the Pri Galil factory, where employees work 10-hour shifts and earn minimum wage. As a result of the debts, the banks sued for Pri Galil to be placed under receivership, threatening the jobs of hundreds of employees, many of whom have worked at the factory for decades. Last Tuesday, Hatzor Haglilit was paralyzed as all residents and the municipality held a general strike as an act of solidarity with the threatened employees. Elsewhere, however, unemployment woes were on the rise when it was revealed Wednesday that hi-tech giant Comverse would lay off hundreds of employees, the third such cut in recent months. According to a report in the Kalaklist newspaper, at least 400-500 people will lose their jobs, most of them in Israel. Comverse has 4,500 employees worldwide, 2,600 of them in Israel. The company's current CEO has already laid off several hundred employees since April 2007, including 125 who were fired in late 2008. Like other hi-tech companies, the telecommunications company has had to deal with the global slowdown. Analysts have predicted a five-percent decline in the company's profits in 2009. Meanwhile, the Of Haemek chicken company in Ramat Yishai announced that it would be closing its gates on Thursday and laying off some 200 employees. However, after Eini intervened, the company decided to postpone the decision by a week or two. Of Haemek's management is negotiating with representatives of the banks and the Finance Ministry in a bid to secure a state-guaranteed loan. Yaakov Lappin contributed to this report

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