Israeli Businessman Tzahhi Abu Rules Out Returning to GCity Deal
Israeli businessman Tzahhi Abu has stated he would not reconsider the failed acquisition of GCity, even at half the agreed price, following the deal's collapse two weeks prior. Abu spent the time since the deal fell apart on vacation in southern Spain, telling interested parties that the GCity matter was behind him. His company, Ari Real Estate, had offered 661 million shekels for control of GCity, an offer accepted by seller Haim Katzman. However, the deal imploded within four days after Abu brought in partners, Yeshpro, leading to disputes over control and management expenses.
Abu explained that his interest in GCity stemmed from two years of observing its performance, even holding its stock personally. He saw significant potential for improvement and profit within the company. The initial contact with Katzman was direct after a public announcement of the sale. Negotiations began with Katzman's chosen representative, Tzachi Sultan, but disagreements arose over control, management costs, and executive salaries. Abu had signaled his intention to cut management expenses by half, sell off Brazilian and American operations, and raise significant capital, which reportedly unsettled Katzman.
Katzman's alleged actions, such as issuing unnecessary bonds and proposing a golden parachute for the CEO, were seen by Abu as attempts to provoke him into canceling the deal. Abu initially intended to proceed and address these issues post-acquisition but ultimately canceled when Katzman refused to include Yeshpro in the regulatory filing for competition approval. Abu emphasized that he is not litigious and offered to walk away if Katzman was uncomfortable, which led to the deal's termination. He clarified that Katzman's issue was not with Yeshpro itself but with the immediate shift in control they represented.
Abu also discussed his company, Ari Real Estate, which he aims to make one of Israel's largest yield-generating real estate firms. He defended his company's stock performance, stating it is undervalued and that he continues to buy shares. He dismissed the idea of distributing dividends or returning to the GCity deal, attributing the failure to misjudging Katzman rather than the deal's viability. Abu highlighted his business philosophy, emphasizing respect and collaboration, and contrasted his background with Katzman's, while maintaining that their negotiations were initially respectful despite differing origins.
The article also touches upon Abu's broader business ventures, including his family's historical real estate holdings in Ashdod, his acquisition of Pi Glilot from Yitzhak Tshuva, and his involvement in other publicly traded companies. He explained his strategy of operating multiple distinct companies to cater to different investor interests within the real estate sector. Abu also discussed his chairmanship of Albetek, a defense company, and his recent acquisition of a stake in Wi-Box, a yield-generating real estate company, alongside former Shikun & Binui CEO Tamir Cohen.
