Author Topic: El Al to be nationalized again  (Read 824 times)

Offline Moshe123

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Offline Moshe123

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Re: El Al to be nationalized again
« Reply #1 on: July 06, 2020, 10:31:16 AM »
Too bad. No reason for it to not go bankrupt and get rid of the unions. But this is Israel. Who am I kidding?

Offline Yonah

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Re: El Al to be nationalized again
« Reply #3 on: July 06, 2020, 10:50:35 AM »

Offline Yonah

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Re: El Al to be nationalized again
« Reply #4 on: July 06, 2020, 10:53:23 AM »
In other news - my son now has two flights booked for Israel - the question is will either or both be cancelled and/or will he even be allowed in the country.

Offline tavster

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Re: El Al to be nationalized again
« Reply #5 on: July 06, 2020, 10:54:11 AM »
https://www.calcalist.co.il/local/articles/0,7340,L-3838238,00.html
That will only take place if they sign an agreement with the pilots.. good luck with that

Online ExGingi

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Re: El Al to be nationalized again
« Reply #6 on: July 06, 2020, 01:06:15 PM »
Too bad. No reason for it to not go bankrupt and get rid of the unions. But this is Israel. Who am I kidding?

Which is why the pilot unions support the move.

Additional sources
https://www.israelhayom.co.il/article/778215
https://www.themarker.com/markets/.premium-1.8974336

To summarize the move:

ELAL will get a $250MM 7-year loan from Discount Bank with a 75% guarantee from the Israeli Govt.
$150MM new shares will be issued, and whatever isn't purchased by the public, will be purchased by the Govt. If Govt. ends up buying entire new issue, Govt. will own 61% of the company.
I've been waiting over 5 years with bated breath for someone to say that!
-- Dan

Offline tavster

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Re: El Al to be nationalized again
« Reply #7 on: July 06, 2020, 01:15:29 PM »
Which is why the pilot unions support the move

IMHO unions are happy to have a new counterpart to deal with, since things were going nowhere with current owners.

 Doesn't necessarily mean that when negotiation time come they will agree to all the pay cuts etc that they are currently refusing. Time will tell

But the change of ownership is definitely good news as current ones are proven to be very poor imho

Online ExGingi

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Re: El Al to be nationalized again
« Reply #8 on: July 06, 2020, 01:26:48 PM »
IMHO unions are happy to have a new counterpart to deal with, since things were going nowhere with current owners.

 Doesn't necessarily mean that when negotiation time come they will agree to all the pay cuts etc that they are currently refusing. Time will tell

But the change of ownership is definitely good news as current ones are proven to be very poor imho

UNIONS HATE BANKRUPTCIES, as those toss any existing agreements out the window.
I've been waiting over 5 years with bated breath for someone to say that!
-- Dan

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Always praying for delayed baggage.

Offline tavster

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Re: El Al to be nationalized again
« Reply #10 on: July 06, 2020, 03:40:58 PM »
Quoting Haaretz:

Acceptance of the plan marks the latest – but by no means final – twist in months of negotiations between the airline, the government and unions over how to rescue Israel’s flag carrier.

Even after the board approved the rescue plan, management still must meet the government’s terms for the loan guarantees. This includes squeezing $400 million of annual cost savings, in part by axing 2,000 of the company’s 6,500 employees and selling seven to 10 planes. El Al also has to reach collective labor agreements with the workers’ committees, not only over layoffs but over changes in work practices.

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Re: El Al to be nationalized again
« Reply #11 on: July 06, 2020, 05:16:30 PM »
Quoting Haaretz:

Acceptance of the plan marks the latest – but by no means final – twist in months of negotiations between the airline, the government and unions over how to rescue Israel’s flag carrier.

Even after the board approved the rescue plan, management still must meet the government’s terms for the loan guarantees. This includes squeezing $400 million of annual cost savings, in part by axing 2,000 of the company’s 6,500 employees and selling seven to 10 planes. El Al also has to reach collective labor agreements with the workers’ committees, not only over layoffs but over changes in work practices.

Will they exit the shorthaul market where they compete with LCCs and ULCCs?
I've been waiting over 5 years with bated breath for someone to say that!
-- Dan

Offline tavster

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Re: El Al to be nationalized again
« Reply #12 on: July 06, 2020, 11:54:17 PM »
Will they exit the shorthaul market where they compete with LCCs and ULCCs?
I haven't heard anything but it sounds very likely.
Once they get rid of 10 737 that leaves them with 10,  which I would guess would be used for London, CDG, AMS, BCN

Offline tavster

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Re: El Al to be nationalized again
« Reply #13 on: July 07, 2020, 09:10:28 AM »
Press has been talking about potential buyers for LY.

Just thinking out loud. To buy control one needs to buy shares from Knafayin (currently valued at $27 million), plus take part in the $150m equity issuance, so that's another $57 million. So for $84m one can control the company.

No one would buy this without having agreements signs with all the unions for significant cost cutting.

So with that in mind one can buy a company that will be worth a lot more once it becomes profitable, and be able to receive dividends etc.

Am i missing something?

Offline yochai

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Re: El Al to be nationalized again
« Reply #14 on: July 07, 2020, 09:12:03 AM »
I haven't heard anything but it sounds very likely.
Once they get rid of 10 737 that leaves them with 10,  which I would guess would be used for London, CDG, AMS, BCN
They use wide-body planes for LON