With Assaf Bergerfreund

Former police commissioner Rafi Peled, one of the owners of the troubled Peled-Givony Group, has apparently knowingly violated the Antitrust Law, despite warnings from his lawyers.

One of the companies in the group, Hayl Holdings, acquired the controling interest in Feuchtwanger Investments for NIS 82 million, which it borrowed from Israel Continental Bank. The stock itself served as collateral for the loan.

To secure Hayl against a drop in the value of the stock, Mashav - which two months ago was acquired by Givony and David Haby - gave Hayl the option to sell Mashav the entire stake it had in Feuchtwanger (42%) for NIS 50 million. Mashav thus provided an insurance of sorts to the bank.

Peled's attorneys, M. Seligman & Co., apparently cautioned him that under antitrust law, any acquisition that provides a single entity with a holding of over 25% in a company is tantamount to a merger, which requires the approval of the Antitrust Authority.

Peled apparently disregarded this warning, as well as the best interests of minority shareholders.

As soon as the Israel Securities Authority began its investigation into Peled-Givony, Continental Bank - which had a lien on the option - exercised it. But Leumi Pia, which holds Mashav stock, got the court to stop the bank.