The Israel Corporations Authority said on Tuesday it will allow Eli Rozenberg, an ultra-Orthodox 30-year-old immigrant to Israel from the United States, to purchase more than 40% of El Al Israel Airlines.
It was a dramatic turn of events because Rozenberg's bid hasn't been considered seriously and it wasn't clear who his financial backers are.
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Rozenberg resides in Jerusalem and is the son of businessman Ken Rozenberg, owner of one of the largest chains of nursing homes in the United States, and founder and CEO of Centers Health Care.
To show his seriousness, Eli Rozenberg initially deposited $15 million into a loyalty account and even offered to immediately transfer another $75 million to El Al in exchange for 44.99% of the company, which would give him a controlling stake in the company.
"I would like to thank the Corporations Authority for its professional due diligence. My offer is the only way to rehabilitate El Al and march it forward to its rightful place. [Israelis] are desperate for their national airline to be stable," said a statement on Rozenberg's behalf.
Three weeks ago, Rozenberg told Israeli financial portal Globes that he is not so concerned about El Al's current financial crisis, due most recently to the coronavirus pandemic, and is looking towards the future. The global pandemic forced the shutdown of regular services for the airline.
However, according to the report, it is not clear whether the airline's parent company, Knafaim, which owns the controlling shares, will be willing to sell. So far, it has rejected the bid.
El Al reached a $400 million bailout agreement earlier this month, which is likely to result in its being nationalized.
According to the terms of the deal, the airline will receive a $250 million government-backed loan, and raise another $150 million by selling shares on the Tel Aviv Stock Exchange, with the state purchasing any unsold stock.
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