Responsa to Guy Rolnik's August 8, 2002 column, Bezeq's MBO

Bezeq CFO Oren Lieder commented as follows (translated from Hebrew):

It is an interesting conspiracy theory Guy Rolnik cooked up for us in his article "Bezeq's MBO". He also took the opportunity to cast some irrelevant aspersions against Bezeq's management which should be cleared up without delay.

The only affiliation Bezeq's management had to Shamrock's petition is that it is a declared supporter of the company's privatization, believing it central to the company's future and to its developmental and competitive capabilities. Beyond that position, Bezeq has not taken any stand on the matter, nor does it believe it should.

Conversely, the claim that Shamrock, "for almost two years now might as well have been part of Bezeq's management" warrants unqualified denial. Shamrock is not involved in Bezeq in any way, not in deed and not vis a vis information. The good relations its people have with some of Bezeq's management do not step beyond those Bezeq has with other partners in its subsidiaries, including some who have submitted candidacy to acquire control over Bezeq. Beyond that, the influence Bezeq's management has over the choice of the buyer of (if we reach such a time) is absolute zero. Briefly no MBO and nothing smacking of MBO.

Regarding the "bizarre deal" through which Shamrock bought shares in (Bezeq subsidiary) Pele-Phone Communications: The transaction was done in order to assure Bezeq the possibility of obtaining full ownership of Pele-Phone without turning it into a government company in the interim and as such, the transaction was done professionally and efficiently. Anybody objecting to the move then, and anybody deeming it a "bizarre deal" now, is assuming that Pele-Phone might as well have become a government company, and that in any case the "breaks" the government offered it would have solved the problem.

Bezeq's management opined then and continues to say today that anybody believing that, including Guy Rolnik, does so out of total dearth of information and understanding of the issues, and that the management's actions were entirely correct and necessary, in its capacity to act in the best interests of the company and its shareholders (and, if anybody can show us another example of a substantial Israeli company - operating in a competitive market - that becomes nationalized, we'd be happy to discuss the conclusions arising from this example.)

Whatever the (all legitimate) opinions may be regarding Shamrock's request, and whatever the government decides on the issue, Bezeq's management in general - and its deliberations regarding the ownership of Pele-Phone in particular - are certainly not the right address for the matter.