Nakash Family Sells Control of Arkia Airlines for $45 Million

After two decades of ownership, the Nakash brothers are selling their controlling stake in the Israeli airline Arkia. The new ownership group includes Kidon Dahari and Yaron Adib, owners of the Yeshpro-Tnuport Group, along with businessman Yariv Lerner and businesswoman Einav Adib-Berrer. The deal involves a total injection of $45 million into the airline, with the buyers contributing $30 million, the Nakash brothers investing $8.5 million to retain a 3% stake, and the state adding $7.8 million. The buyers' investment is split, with Dahari and Adib providing half, Lerner $10.5 million, and Adib-Berrer $4.5 million. The airline has faced significant losses, exceeding $30 million in the past year and potentially reaching $50-60 million by year-end, largely due to soaring global fuel prices. The new owners acknowledge a challenging winter season ahead, with expected further losses before potential profitability next summer. Arkia's employees, who currently hold 22% of the company's shares, oppose the deal, with the Histadrut labor union stating the transaction cannot proceed without their approval. Negotiations between the parties are ongoing. The Nakash brothers originally purchased Arkia in 2005 for $10 million. The sale comes after previous attempts by the Nakash brothers to inject more capital were met with resistance from employees concerned about further dilution of their stake. Arkia, the third-largest airline at Ben Gurion Airport with 1.44 million passengers this year, has recently expanded its routes to the US and Far East. However, it also faces challenges with flight delays, ranking fifth among all airlines at the airport for delays. The new owners aim to stabilize and strengthen the company, improve service quality, and compete directly with rivals like Israir.