Israeli Plastic Manufacturer Starplast Faces Liquidation Over Millions in Debt
Translated & summarized from Ice by baba
Bank Hapoalim has asked a court to liquidate Israeli plastic manufacturer Starplast due to approximately 29.8 million shekels in unpaid debt. The company, founded in 1967, has faced financial crises from rising costs, a strong shekel, and European boycotts. Despite a demand for repayment and failed investor talks, the debt remains outstanding. The court has not yet issued a decision.
The story in 5 lines · by baba
- Bank Hapoalim seeks liquidation of Israeli plastic maker Starplast over 29.8 million shekel debt.
- Starplast, operating for nearly 60 years, faces severe cash flow and financial crises.
- Rising raw material costs and a strong shekel have impacted the company's profitability.
- Negotiations with an external investor failed to secure a deal acceptable to the bank.
- The company previously employed 350 workers in Israel and 300 in Texas.
Bank Hapoalim has filed a request with the Nazareth-Nof HaGalil District Court for the liquidation of Starplast, an Israeli plastic product manufacturer, citing significant debt. The bank claims the company owes approximately 29.8 million shekels, following a previous repayment of 38.6 million shekels in late July under interim agreements. According to the bank's petition, filed by attorney Amir Palmer, Starplast's financial difficulties led to a previous agreement that expired in May. Since its expiration, the company has failed to make interest payments on existing credit and has not resumed loan repayments.
Starplast, established in 1967 and operating for nearly 60 years, specializes in plastic products for home, kitchen, and garden use, primarily for export to the US and Europe through subsidiaries. The company has been experiencing severe cash flow and financial crises in recent months, attributed to rising raw material costs, a strengthening shekel impacting export profitability, and the effects of European boycotts.
In August, the bank issued a demand for immediate repayment of the full debt within 21 business days, which went unmet. Negotiations with an external investor also failed to materialize into an agreement acceptable to the bank, which argued that the proposed plan would only repay a minimal portion of the total debt.
The bank presented a dire financial picture to the court, stating, "There can be no dispute that the company is insolvent both on its balance sheet and in terms of cash flow, and to the best of the bank's knowledge, it has debts to additional banking entities and other parties amounting to tens of millions of shekels more which it is not repaying." The court has not yet ruled on the bank's request.
Starplast previously employed hundreds of workers globally, with 350 at its Israeli plant in Alon Tavor and approximately 300 in Houston, Texas. The company had already initiated layoffs in May, partly due to reduced operations related to the conflict with Iran.
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