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Proposal to merge IMI with IAI, or Rafael

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Friday, December 31st, 2010

As reported by IVC:

The trial balloon was raised during a meeting between Defense Minister Ehud Barak, Finance Minister Yuval Steinitz, and Histadrut chairman Ofer Eini.

Instead of privatization, Israel Military Industries Ltd. (IMI) may be merged with Israel Aerospace Industries Ltd. (IAI) (TASE: ARSP.B1) or Rafael Advanced Defense Systems Ltd., according to a trial balloon raised during a meeting on Thursday between Minister of Defense Ehud Barak, Minister of Finance Yuval Steinitz, and Histadrut chairman Ofer Eini. Both IAI and Rafael are government companies, which were once units of the Ministry of Defense.
The meeting aimed at finding a solution for the prolonged crisis at IMI, as talks for the company’s recovery have been deadlocked for months. Disputes between Barak and Steinitz have resulted in no new chairman being appointed at IMI, and stymie any operative measures to privatize the company. In an effort to compel IMI to take action on the privatization, the Ministry of Finance has withheld state guarantees for new foreign contracts.

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