Dei'ah veDibur - Information & Insight

A Window into the Chareidi World

27 Teves 5764 - January 21, 2004 | Mordecai Plaut, director Published Weekly









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El Al Might Fly on Shabbos Following Arkia Buyout
by G. Kleiman

According to airline industry sources national airline El Al will begin to fly on Shabbos and holidays after the government begins to implement its plan to privatize the company, which it appears will involve a takeover by Arkia.

According to reports Arkia recently took control of over 50 percent of El Al stocks and options, at the Tel Aviv Securities Exchange. Tourist industry figures believe that when the core control of the company is transferred to Arkia, El Al will begin to operate on Shabbos and holidays "thereby allowing it to join international agreements with major world airlines."

The owners of Arkia are expected to realize their options in the first phase by June 5th by purchasing 49 percent of El Al shares and in the second phase by the beginning of January 2005 by purchasing additional shares that will allow it to hold core control of the company. If the options are not exercised by June 5th, they expire and will return to the government. Arkia Managing Director Izzi Borovich said he will have little problem raising $50 million to complete the deal and to merge Arkia into El Al. He tried to ease El Al administration workers' concerns over layoffs following the merger, saying he would not replace company management.

Dror Strum, in charge of business antitrust restrictions, has claimed in the past that the merger of the two Israeli airlines presents a problem because it would decrease competitiveness. Arkia will have to receive his approval before exercising its options, Strum said. "When the time comes we will have to sit down with the figures involved in the matter and find a way to solve the problems and how to limit the united company's cooperation with Yisrair, which is the only competing company in the airline market in Israel. Cooperation is liable to lead to a monopoly and agreements on flight prices, which would be to the customers' disadvantage."

Many El Al workers expressed worries that an Arkia takeover would lead to the firing of religious employees who refuse to work on Shabbos and holidays.

In response, MK Rabbi Avrohom Ravitz told a Yated Ne'eman reporter that when the government decided to privatize El Al it was clear it would be impossible to prevent it from flying on Shabbos and holidays. "The state is gradually losing its Jewish identity and the prominent Jewish emblem--keeping Shabbos. The day will come when the State of Israel will become a nation like all of the other peoples, and the nations of the world, too, will relate to it as a state that has no Jewish identity."

MK Rabbi Moshe Gafni told Yated Ne'eman, "Gedolei Yisroel shlita have told the religious public how to relate to an airline company that is operated by Jews on Shabbos and holidays, which constitutes a major, public desecration of Shabbos and encompasses hundreds of workers. The businessmen who want to purchase El Al will have to make their financial and business calculations, and assess whether it is worthwhile for them to lose a substantial segment of regular religious passengers who have been loyal to the company . . . In addition to the aim of privatizing government and public companies, the government has plans to open the market to competition and to decrease the monopolies in the market, which are to the consumers' disadvantage. In the deal in question, the monopoly in the airline industry would become stronger and it would be bad for the economy and for consumers. Therefore it comes as a surprise that the government is promoting this destructive move."

During the first nine months of 2003 El Al suffered $14 million in losses. The company ended the third quarter of 2003 with a profit of $61 million. Valued at $197.5 million, El Al employs 3,170 workers and has 29 planes.


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