Cable TV firm Tevel owes money to C. Mer Industries(TASE: CMER ), which provided it modems, but C. Mer is just one of many suppliers to which Tevel owes money.
C. Mer Industries CEO and shareholder Chaim Mer believes communications equipment provider Netcom's petition that the court appoint a receiver for Tevel due to unpaid bills, is just the beginning of trouble for Tevel.
Mer spoke about steps he will be taking in respect of Tevel's unpaid debts. "I talk with Tevel's banks, and I carefully weigh my moves. I have medicine but I don't take out all the pills at once, because a bullet in the barrel must be fired. That's why I prefer to examine my moves cautiously and slowly," Mer said.
"Tevel isn't paying its bills and Netcom's receivership petition is the beginning. It's a snowball. Unlike Netcom, I am not claiming the return of goods, but am claiming money owed."
"The company has long gone bankrupt. There is no doubt that their situation is extremely bad. The cable companies are clearly planning to raise prices by 20% to 25%, and they will dismiss several hundred people who anyway don't bring them benefit," Mer said.
"Tevel can meet its debts given 3% to 4% current market interest rates. They have to cut, there's no choice, but it is possible to rehabilitate the company. Today, there's an historic opportunity as interests rates are low. Given a certain situation and different management one could rehabilitate the company. The failure was managerial. Who signed those expensive content agreements? Who recruited the volume of workers?" Mer said.
Referring to the other two cable TV firms Matav Cable Systems (Nasdaq:MATV) and Golden Channels, Mer said that there are no problems with them and that they pay almost on time. He said there are problems with satellite TV firm YES, but its monthly debt comes to a low amount of NIS 1.3 million. Mer said YES pays after 120 days.
"It would have been possible to run the whole industry otherwise. The real owners in the companies are the banks, which don't apply a sufficiently militant policy," Mer said.