a different side of Israel

Tag: Arkadi Gaydamak

Africa Israel Can’t Pay its Debts

A second Israeli giant is on his way down. After Arkadi Gaydamak, the Russian billionaire, unceremoniously fled the country with his tail between his legs and renounced his Israel citizenship after a miserable failure of an attempt to run for mayor of Jerusalem by courting the Arab vote, Lev Leviev, another Russian billionaire and owner of Africa Israel, is suffering. The company lost over 1.3 billion shekels in the last quarter, and stock in his company has plummeted. He recently announced that the company will not be able to repay their debts starting in 2011. His biggest mistake? Investing in the US.

Leviev2009 debts are about 600 million, with 2010 being about one billion shekels, which they will be able to meet. After that, it all depends on where the global economy stands.

In big trouble from this crisis is Bank HaPoalim, which has significant investments in Leviev’s company, and if Africa Israel indeed can’t repay what they owe the bank, then the Israeli banking system could take quite a hit, as HaPoalim is the lead domino in what could be a continuous fall. Commission paid to banks in Israel is high as it is already, and HaPoalim has lost a lot of money in recent years. Just wait until Leviev’s drop comes around and then see what happens to bank fees. It’s not going to be pretty.

The encouraging news is that Israel is one of the first countries to officially exit the global recession, with economic growth small, but measured in the last quarter. Hopefully, it will be enough to offset this, and perhaps the giant can recover in time for the upswing. Until such is determined, it will be an interesting next few years. Is it ever not?

I wonder who the next Russian billionaire to get some stress will be. Leviev has admitted to flowing a billion shekels of his own money into the company to keep it afloat, and tells of working 20 hour days recently in a frantic frenzy to keep above water.

Back to Kassam School in Sderot

The beleaguered Israeli town Sderot, only a ‘stones throw’ or in this case, a Qassam rocket launch away from Gaza, “celebrated” the new school year today, September 3, being once again under a barrage of Palestinian launched Qassam rockets. When it had been announced earlier by local municipal authorities that the town of 15,000 would start the 2007/08 school year like every other Israeli community, their “neighbors” in the Hamas led Palestinian Gaza Strip decided otherwise. These “good neighbors” shot not less than 7 home made missiles into Israel, one of them actually striking a kindergarten and sending more than 20 children to hospital for treatment from severe trauma and shock.

The afternoon news broadcasts, showing scores of Sderot residents and police scurrying for the shelters, was a sad reminder that this type of harassment is far from over. Despite Prime Minister Olmert appearing on television with a warning that these kind of incidents will not be tolerated by Israel, it can only be wondered if the Palestinians will take Mr. Olmert seriously. Most likely, they will not.

Previous retaliations against Palestinian terror groups who are involved in this kind of activity have not been very effective; and even if several key terrorists are ‘taken out’ by selective “culling”, there are plenty more volunteers to eagerly take their place. I say eagerly, because it must be understood by all that not only are these people (the Palestinians) not afraid to die, they look forward to the “opportunity” to become ‘Holy Martyrs’ for their cause.

Israeli communities like Sderot and several smaller towns and settlements, including kibbutzim, which lie near the border with Gaza, will most likely continue to suffer these attacks; and larger communities like Ashkelon and Kiryat Gat may soon be targeted as well. It’s no secret that Hamas and other groups have been smuggling many varieties of weapons and explosives into Gaza; and longer range rockets may be part of this new arsenal. Even benevolent people like Arkady Gaydamak won’t be able to do much to alleviate the suffering of the people in areas under fire.

Recently, exiled Hamas leader Khalid Mashaal stated that relations between the Palestinians and Israel cannot improve as long as the Israeli military continues to “massacre” innocent Palestinian civilians. What Mr. Mashaal means by this term is puzzling as the IDF tries very hard to minimize civilian casualties among the Palestinians despite unfortunate incidents such as the deaths of three Palestinian children during a recent IDF military operation. With Palestinians having some of the most densely populated cities and towns in the world, it’s no wonder that occasionally some Palestinians are caught in the line of fire – especially when many Kassam rocket attacks occur from within densely populated areas.

Such is the reality of “back to school” in both the P.A. and some Israeli communities; especially Sderot.

Did Gaydamak save the “Chazer Store”?

Strange things definitely happen in this world. And one of the strangest things is the sudden decision by Russian billionaire Arcadi Gaydamak to cancel his purchase of 51% of the shares of the non-kosher food chain Tiv Taam. Gaydamak’s previous announced buy-out of Israel’s third largest supermarket chain, albeit non-kosher, and known affectionately by many as “the chazer store” (chazer in Yiddish meaning pork), became breaking news a few days ago; especially since Gaydamak announced that he planned to “convert” the food chain to one either not serving pork, or actually to one being certified as kosher.

The offered sum of $100 million must have been a worrisome amount for even someone like Arcadi, whose accumulated wealth is estimated at between 1.5 and 4 billion dollars. With all the media hype that has been thrown at everyone by the press (their favorite pastime) during the past few days, Arcadi must have begun to have second thoughts concerning the validity of his offer to the company controlled by financier Amit Berger and former Tiv Taam CEO Kobi Tribitch. So serious was Gaydamak’s reservations, he decided to reduce his offer by $10 million, with the likely idea that he would need to spend at least this amount to “Kosher” all the stores properly as well as absorb significant losses until the general public decided to once again purchase products at the Tiv Taam stores.

Even if pork and non kosher items were completely removed, including a big selection of non-kosher wines (one of the largest in Israel) there was still the matter of being open on the Jewish Sabbath and religious holidays. Consumers had gotten used to the convenience of being able to do their shopping there on both Friday evenings, until 8 p.m; and all day on Saturday. How Gaydamak would have gotten around this hurdle is still anybody’s guess.

So now the situation seems to have reverted to what it was before the earth shaking announcement of the proposed buyout less than ten days ago. One thing is for sure: non-kosher meat processing companies, including the one located at Kibbutz Mizra, located near Nazareth, are breathing a sigh of relief as a good deal of their income would have been lost had the deal actually gone through. And for those who appreciate being able to “run to the chazer store” for a few needed items on Shabbat, or for a tray or two of sushi, will now be able to continue to do so; unless some other billionaire like Lev Leviev (who is religious) might decide to purchase Tiv Taam and either ‘convert’ it to one selling only strictly kosher items or even close it down altogether.

Until that dark day happens, those who love wandering through what is considered a truly upscale European-style supermarket will still have the opportunity to do so.

Isn’t it interesting how things sometime work out for the best?

Labor Party Primaries Hardly Noticed In Israel

No One Worth Voting For - Labour 2007With Israel Labor Party primaries only hours away, and on top of current security issues such as the beleaguered town of Sderot and military actions into Gaza, tomorrow’s inter-party primary elections for a new Labor Party leader seem to be so boring that even the most mediocre TV program will probably receive better ratings.

The three front-runners, including present party leader and Defense Minister Amir Peretz, also include former Prime Minister Ehud Barak, and a newer ‘kid on the block’ former Naval Chief Ami Ayalon; who appears to be the front runner, and the only new face among a group of hopefuls whose aspirations are not generating any excitement within a political party which is only a shadow of it’s former self.

Peretz, running a distant third behind ‘Rear-Admiral’ Ayalon and Barak ‘The Watchmaker’ (Barak’s favorite hobby is disassembling and reassembling watches and clocks) still thinks he can pull off an upset and retain his present position, made increasingly unstable in the aftermath of the sensational Winograd Report. Amir appears to have delusions of grandeur, however, as pre-primary polls show him able to garner less than 20% of the party vote, compared to Barak’s 31% and Ayalon’s 35%.

Barak also appears to be suffering from a few delusions himself, as his short term as Prime Minister resulted in Israel’s hasty pull-out from Lebanon in May, 2000, followed by the disappointing Camp David Summit later that summer and the Second Intifada in the fall. Even Barak himself seems to have some doubts as he was quoted recently as saying: “if there will be a run-off, I’ll lose it (the election)”.

Ayalon appears to be the only possible man who might possibly be able to bring some new life into the party which was virtually unopposed in Israeli politics for nearly thirty years. But in light of present realities, even he may have an uphill struggle due to infighting within Labor, together with Ayalon’s personal connections with Palestinian Professor Sari Nusseibeh concerning a two state solution for Israelis and Palestinians; a not too popular conception nowadays with Kassam rockets still raining down on Israel’s southern regions. The aftermath of last summer’s war, coupled with the present Hamas led hostilities in the south, has increased right winged feelings and given strength to more hawkish political parties, particularly opposition Likud party leader Benjamin ‘Bibi’ Natanyahu.

In the fall-out from events which may occur during the coming days (especially if the conflict with the Palestinians grows more intense) it may even set the stage for such people as Arkadi Gaidamak to become even more popular at the expense of current politicians, including Prime Minister Ehud Olmert, who appears to holding onto power by the skin of his teeth. If Gaidamak continues to win friends and influence people, as he has with his assistance to Sderot residents and others in distress, even he might be a possible political leader in the not so distant future. After all, with all the millions that Arkady has, he doesn’t need to be corrupt – he has enough money already.

Labor’s chances of being in the next Israeli government are not too good at this point. But Israeli politics often results in strange bedfellows; and when push comes to shove, this party could very well be right in there again, alongside an even more right-winged government. After all, a deal is a deal, even if the ‘menu’ is not too palatable.

Arkadi Gaydamak is THE MAN

I am telling you, this Arkady Gaydamak can take care of everything. He is just everywhere…
Moshik! thinks so as well. For the Hebrew challanged, the wife says to the husband: “But you said it wasn’t happening for you..”

Arkady Gaydamak

Arkadi Gaydamak – Billionaire, Sports Fan, Newspaper Owner, Arms Dealer, did I miss anything..

Arkady Gaidamak in Israeli News
I can’t keep up. Too much happening too fast. Arkady Gaydamak (53) is all over the place. I planned to write this piece on this phenomena called Arkady (Arcadi or Arkadi) Gaydamak (an Oligarch) and as I am writing these words there are 2 new news bits that involve the Gaydamak family. This is like trying to nail Jello to the wall, and as you will see, apparently some law enforcement agencies seem to think the same thing.

Let’s start with the old news. Gaydamak moved into Israel and did some local shopping. He bought Jerusalem’s Beitar Jerusalem, a rather controversial soccer team. He then also bought a basketball team and donated $400,000 to a third team just to keep things fair.

But the shopping spree started earlier with this little acquisition reported in Russia:

“That changed this week when Gaydamak acquired the Moskovskiye Novosti, a leading Russian liberal publication from the time of perestroika. The St. Petersburg Times reported that “Arkady Gaydamak, a Moscow-born businessman with four passports and a controversial past, confirms that he had bought the weekly newspaper.”

“Gaydamak seems still to be close to the Angolan government and he is definitely involved in Angola’s Sunland Mining, a company in which Alrosa is believed to be the largest shareholder. As is well known, Sunland is one of the official buyers of rough diamonds from Angolan state company Sodiam. Gaydamak once was in partnership with Lev Leviev. Though they publicly talk nicely about each other, there is no doubt that there has been a fall-out between these ex-partners.”

Forbes had an interesting article about Gaydamak, shedding a little more light about the Angola (alleged Angola) connection and the connection to Lev Leviev, owner of Africa Israel, the largest real estate behemoth in Israel, and someone who had gone on several shopping sprees himself a few years back:

“A friend of his (Lev Leviev’s), Arcadi Gaydamak, an alleged arms dealer with Israeli and Russian citizenship, was an adviser to Dos Santos. According to the Center for Public Integrity, in the mid 1990s Gaydamak (wanted in France for illegal arms trafficking) negotiated a forgiveness of Angolan debt to Russia, in exchange for arms. In January 2000, a month after Leviev’s Ascorp was awarded the exclusive on Angola’s diamonds, Gaydamak bought 15% of Leviev’s Africa Israel Investments. Within a year Leviev bought back Gaydamak’s stake. A quid pro quo? “He offered to sell me the shares at a good price,” says Leviev. “This was a time before Mr. Gaydamak had legal problems.” While the two are no longer business associates, they remain chums.”

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