Home > Chemical News

Chemical News

Union steps up campaign against proposed sale of Israel Chemicals to Canadian potash giant

http://www.chemnet.com   Feb 25,2013 Platts
Union steps up campaign against proposed sale of Israel Chemicals to Canadian potash giant
Workers at Dead Sea Works Ltd have stepped up their campaign against the proposed sale of Israel Chemicals to Potash Corp of Saskatchewan, union officials said on Friday.

Dead Sea Works committee chairman Armond Lankry said on state radio that workers would hold protests in the coming weeks to prevent the proposed deal. Dead Sea Works is a wholly owned subsidiary of Israel Chemicals and a leading producer of potash.

The union leader threatened to shut down all Israel Chemicals plants throughout the country if the government approves the sale.

The militant tone followed a report this week in the Calcalist economic newspaper that PCS was prepared to pay over $20 billion for Israel Chemicals. The report said that PCS officials met in the past week with the heads of Israel Corp., a local holding company, which holds a majority stake in Israel Chemicals. The merger offer first surfaced in October following a meeting between PCS CEO Bill Doyle and Israeli Prime Minister Benjamin Netanyahu.

On Thursday Israel Chemicals denied that any talks were held in the past week though Israel Corp. has not commented. Israel's Finance Ministry said in a statement that there were no negotiations with PCS at present.

The Israeli government needs to approve any deal as it holds a "golden share" in the company following its privatization in the 1990s. The issue was put on the back burner by Netanyahu during the run up to the January 22 Knesset elections due to strong opposition to the proposal in many quarters.

Initial reports said that Netanyahu was not opposed. He is currently trying to set up a new coalition government. One of the potential partners, the second largest party in the Knesset, Yesh Atid, has come out against the merger. Party leader Yair Lapid said he would oppose any sale to PCS as it would lead to the laying-off of Israeli workers and would not be in the best interest of the country.

And Labor Party opposition leader Shelly Yachimovitch resumed her campaign this week against the proposed takeover. She said any such deal would be a total disaster for the state treasury, for employment in southern Israel and for the state to determine a fair and equitable royalty and tax policy on the country's natural resources.

Yachimovitch said she had no doubt that once a new government was formed by Netanyahu pressure on politicians and bureaucrats would intensify to approve the deal. The Labor party leader said that the Ofer family -- which controls a majority stake in Israel Chemicals through its Israel Corp. holding company -- was the main beneficiary, enjoying substantial tax breaks.

Yachimovitch said it was the most important struggle since the battle to change the tax regime for the oil and gas exploration industry.

 Print  |    add to Favorites  |    Close