JERUSALEM Israel’s Government Companies Authority said it would recommend allowing Eli Rozenberg to buy control of cash-strapped El Al Israel Airlines.
Rozenberg last month offered to funnel $75 million into the airline in return for a 45% stake. He is the son of American businessman Kenny Rozenberg, who is CEO of New York-based nursing home chain Centers Health Care.
The authority said it would allow control of Israel’s flag carrier with a stake of over 40% conditioned upon proof of Rozenberg’s Israeli citizenship or residency. Israel would retain a golden share.
Israel’s finance and transport ministers also need to approve Rozenberg becoming the controlling shareholder.
El Al’s board had agreed to a bailout that could put the carrier back under state ownership after the coronavirus crisis pushed it to the verge of bankruptcy.
The government has offered to back $250 million in bank loans while El Al must issue $150 million in shares, which the state will buy if no one else does. The carrier’s unions have already agreed to a significant cost-cutting measures.
El Al, which has reported losses for two years running and racked up debt to renew its fleet, suspended flights when Israel closed its borders and furloughed most of its employees.
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