Family Dispute Exposes Half Price Chain's Plans to Bring in New Partner Amid Debt Crisis

The longstanding Israeli discount retail chain Half Price, co-founded in 1989 by Moti Kuperli and the late Zaki Shalom, has been embroiled in a public family dispute for the first time in over 30 years. This week, a lawsuit was filed by Mazal Shalom, widow of Zaki Shalom, and their daughter Orit Bag-Shalom against Kuperli and his family, revealing deep tensions between the minority shareholders (Shalom family, holding one-third) and majority owner Kuperli (holding two-thirds). The lawsuit, submitted to the Tel Aviv District Court, accuses Kuperli of minority shareholder oppression and mismanagement, including loading the company with heavy debt.

Orit Bag-Shalom, who serves as Half Price's commercial manager, is leading efforts to introduce a new partner into the chain, which is currently burdened with significant bank debts. Sources told Globes that the retail chain, including its real estate assets, is valued at approximately 3.2 to 3.5 billion shekels (including debt) for potential sale of 20% to 50% of shares. This move aims to reduce leverage and support business development, possibly leading to a future stock exchange listing.

The lawsuit details a recent phone call involving Harel Wizel, CEO and owner of fashion chain Fox, and Tzvika Wiliger, owner of food importer Willy-Food, who reportedly expressed preliminary interest in acquiring Half Price. The conversation surprised Orit Bag-Shalom, who was unaware the chain was being considered for sale. Industry insiders expressed skepticism about bringing in investors amid the ongoing family conflict.

The dispute intensified following Zaki Shalom's death in August last year, with legal correspondence continuing until recently. The Shalom family alleges Kuperli sidelined them from company influence and increased the group's debt to 1.2 billion shekels, placing Half Price under special credit supervision by banks. Annual financing costs reportedly reach 120 million shekels. The conflict also involves the related real estate company Kuperli and Shalom Investments, with accusations of unilateral decisions by Kuperli without board approval.

After nearly a year of legal exchanges, Orit Bag-Shalom succeeded in convening a Half Price board meeting last month, which included discussion of the Wizel-Wiliger call and Kuperli's appointment as CEO. Kuperli's representatives denied the allegations, calling the lawsuit baseless and affirming their commitment to professional management and legal defense. The case highlights the challenges of family-owned businesses facing financial strain and governance disputes in Israel's competitive retail sector.