Israel's Bezeq board to hold special meeting on Sunday

JERUSALEM (Reuters) - Bezeq Israel Telecom's board will hold a special meeting on Sunday, a source close to the company said, while Israeli media reported that Chief Executive Stella Handler, who is in police custody, could be replaced at least temporarily.

 

The source said the board would meet but could not confirm whether Handler would be replaced.

 

Handler and another company official were arrested last week in connection with the Israel Securities Authority's (ISA) investigation of Bezeq over allegations including fraud, bribery and securities offenses. They have been ordered to stay in police custody until Monday.

 

Shaul Elovitch, a family friend of Prime Minister Benjamin Netanyahu, who controls Bezeq through his Eurocom holding group, was also arrested along with his wife and son. They are also in custody until Monday.

 

They all deny any wrongdoing.

Israeli media said that in addition to Handler being replaced as CEO, Elovitch his wife and son would resign from the board.

Eurocom declined to comment.

A source close to the matter said that a decision for the Elovitchs to step down would be made in the next few days.

Elovitch in June temporarily stepped down as chairman of Bezeq and has been replaced by acting chairman David Granot.

Amid a 29 percent drop in Bezeq's shares in 2017, activist investor Elliott, which has a 4.8 percent stake in Bezeq, has called for the resignation of all Bezeq directors implicated in the investigation by the securities regulator and those affiliated with Eurocom. Granot has said he expected changes to the composition of Bezeq's board.

Separately, an offer for Eurocom has been accepted by Eurocom's creditors and sent to court for approval, a subsidiary said on Sunday.

If approved, the deal would transfer ownership of Eurocom to a group of investors led by U.S.-Israeli businessman Naty Saidoff, Eurocom unit Internet Gold Golden Lines said.

"The proposed arrangement is based on significant capital investments to be made by the investor in Eurocom, as well as the investor helping to settle the balance of Eurocom and the privately held companies’ debt," said Internet Gold.

It did not provide further details or say when a court decision was expected.

Control of Eurocom, which has about 1 billion shekels ($287 million) in debt, will only be handed over when regulatory approval is obtained, it said.

($1 = 3.4848 shekels)

(Reporting by Steven Scheer and Ari Rabinovitch; Editing by Tova Cohen and Jane Merriman)

 
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