Just weeks after Israeli businessman Haim Sakal submitted a surprise $4.5 billion offer to buy shipping company ZIM, a home he owns in Herzliya Pituach has been placed in receivership over a debt of about 15 million shekels.
In early May, ZIM’s board received an unexpected letter containing Sakal’s acquisition offer. The proposal, sent to ZIM chairman Yair Seroussi, was higher than the offer from German shipping giant Hapag-Lloyd. However, the board did not discuss it, mainly because it had no legal ability to do so: the company had already signed an agreement to be sold to Hapag-Lloyd and Israel’s FIMI private equity fund for $4.2 billion.
Sakal, whose family’s Sakal Group previously operated duty-free stores at Ben Gurion Airport, did not detail the funding sources for his bid. According to previous reports, additional investors were expected to join him. “The State of Israel is my guiding light and must be protected,” Sakal was quoted as saying at the time.
A day earlier, it was reported that Sakal also intended to buy Israeli airline Arkia, but in that case too, no details were provided about the sources of financing. The latest developments now raise doubts over whether such resources are in fact available to him.
About two weeks ago, the Haifa District Court appointed a receiver for a house owned by Sakal on Wingate Street in Herzliya Pituach, following a debt of about 15 million shekels to Extra Credit, a financing company controlled by Moti Ben-Moshe. If the debt is not settled, the process is expected to move toward enforcement proceedings.
Sakal and his wife, Michal, own two adjacent homes on Wingate Street, on the first line to the sea in Herzliya Pituach. According to the Land Registry, one of the homes carries a 12.6 million shekel mortgage registered in favor of Sea & Shells Marketing.
Each of the two homes is estimated to be worth about 18 million shekels, and appraisals have been prepared for both. The family lives in one of the houses, while the other is used by Sakal’s elderly parents. Each property covers about 400 square meters.
The second home also has a mortgage registered against it, although the amount is not listed in the Land Registry. Sources familiar with the matter said it involves an 11 million shekel loan from the non-bank credit company S.R. Accord, controlled by Adi Zim.
Extra Credit turned to the court after Sakal fell behind on repayments. The court appointed attorney Eyal Shani as receiver, and on June 7 an attachment order was also imposed on the home.
As far as is known, Sakal is conducting quiet negotiations with Extra Credit in an effort to settle the debt. As part of the talks, he is offering to repay about 13 million shekels in exchange for a waiver of part of the interest, including arrears interest.
According to the same sources, Sakal is seeking to finance the amount through a loan from another credit company that has expressed willingness to provide him with financing. Extra Credit is prepared to compromise, but gaps between the sides remain.
Sources familiar with the talks said Sakal claims he is expected to receive a significant commission from a mining deal in Africa, which would allow him to repay his debt.
Sakal responded: “The report contains inaccuracies. The family has always stood behind the companies and all their obligations.”
Haim Sakal is the son of Solly Sakal, who founded the Sakal Group together with his brother. The group operated retail chains in fashion, sports and electronics, as well as the duty-free stores at Ben Gurion Airport.
In 2005, the group ran into crisis and collapsed, though over the years it repaid hundreds of millions of shekels in debt to banks.
In 2018, the Sakal family sold its Sakal Duty Free operations, concentrated under the Layam company, to Teddy Sagi for 8 million shekels in cash and an additional 30 million shekels in bank debt. The deal was accompanied by tensions, and last November Sakal filed a lawsuit against Sagi, claiming he was left with a 2 million shekel balance on Sakal’s debt to Layam, for which he had served as guarantor. Sagi rejected the claims.
Sakal’s duty-free operations included tax-free stores at Ben Gurion Airport and Israeli ports, a duty-free store for diplomats in Tel Aviv and stores operating on passenger ships. Layam supplies equipment and goods to ships in ports, as well as duty-free products to airlines, UN forces and NATO.
Sakal was the first to bring brands including Tommy Hilfiger, Ralph Lauren, Nautica and Donna Karan to Israel. Following the financial crisis he experienced about a decade ago, he was forced to sell the franchises to Roni Irani’s Factory 54 group, Brill Group and others.