Off Haemek Goes into Receivership

ISRAEL - All 200 workers at Off Haemek plant are to lose their jobs as the company goes into receivership.
calendar icon 24 March 2009
clock icon 5 minute read

Three weeks after Off Haemek closed down, the decision has fallen: the bankrupt poultry slaughterhouse is heading for receivership, reports Haaretz. All of its workers will be fired with immediate effect, but that isn't necessarily the end of the road for the cooperative, or its workers.

For the time being, the receiver will try to keep the business alive in hope of finding a buyer for it. Meanwhile workers continue to barricade themselves inside, though labor representatives agree that receivership is the only option left. Advertisement

The Registrar of Cooperative Societies, Uri Zeligman, yesterday (23 March) named attorney Nimrod Tepper as receiver, in charge of selling the bankrupt company's assets. Zeligman's decision means that all of Off Haemek's workers will be fired.

However, subject to the approval of the Registrar, the receiver may rehire them, citing the source of funding to pay them.

For the time being, therefore, Tepper means to keep Off Haemek running, in the hope of selling the slaughterhouse to a buyer who would then formally hire the same workers. Thus far, no buyer has been willing to touch the company, which owes about NIS 47 million. Moreover, each month that it operates increases its debt by about a million shekels.

The receivership order issued yesterday empowers Mr Tepper to sell the cooperative in whole, or its assets, but preference is to be given to any offerer that wants to keep it going.

Another significance of the receivership order is that all legal proceedings against Off Haemek, by creditors, are put on ice.

The receiver also ordered Mr Tepper to take steps to protect Off Haemek's 25 per cent stake in Teva Off, which breeds 'natural' chickens without constant doses of antibiotics.

"The decision is frightening, and there are a lot of questions, but given the place to which the company has fallen it's probably the only hope of saving it," said Motti Sa'ar, chairman of the Off Haemek labor committee. Mr Sa'ar, together with the Histadrut labour federation, has been orchestrating highly publicized protests in the hope that public pressure would lead to a rescue for Off Haemek.

"We're under terrible strain," Mr Sa'ar added. Until now, the workers had clung to the hope that somebody would buy Off Haemek and save it, he said. "Now that we understood there's no chance, we support the decision to appoint a liquidator to run the company and sell it. That's our hope."

Meanwhile, some of the workers remain barricaded inside the facility, three weeks after the protests began, according to Haaretz. Histadrut said yesterday that the workers would stay at the facility "until further notice."

In the course of the protests, designed to attract public attention to the plight of the chicken slaughterhouse and its workers, the workers demonstrated outside the facility and elsewhere, including outside the Knesset. Last week, they helped themselves to frozen chickens from Off Haemek's inventory and sold them in the Haifa market, claiming they needed NIS 20 per bird to survive.

The management at Off Haemek commented yesterday that it regrets that the efforts to find a buyer had come to nothing. But they hope one can now be found under the terms set by the Registrar of Cooperative Societies. "The management expects that the receiver will place highest priority on selling the slaughterhouse to a buyer that undertakes to run it and employ the workers, and will continue to provide a livelihood to fowl breeders on kibbutzim and moshavim who remain without sources of income," the management added.

The Histadrut also stated that at this stage, it supports receivership for Off Haemek, so it can continue operating as a going concern. "Two weeks ago, the Histadrut started to form the opinion that the only chance remaining to save the slaughterhouse is through a legal process of liquidation or receivership," the labour federation stated.

Off Haemek is owned by a group of kibbutzim and moshavim, not by a single entity. The owners had been urging the Registrar to appoint a receiver, having given up on reaching a creditors' arrangement or finding a buyer. One of the snags was that Off Haemek operates in a residential area in the Jezreel Valley and has been the subject of innumerable nuisance complaints. Carrying out renovations to resolve that problem would have been very expensive.

"We believe that if a serious acquisition offer is tabled, the government will help, and one of the parties will give in a little on demands - then a solution could be found to resume running the slaughterhouse," the Histadrut told Haaretz.

© 2000 - 2024 - Global Ag Media. All Rights Reserved | No part of this site may be reproduced without permission.