P.M. BRIEFING : Israel Advised to Sell El Al
TEL AVIV — Two U.S. investment banks have advised Israel to sell 51% of the state-owned national airline El Al, the Transport Ministry said today.
A spokesman said representatives from First Boston Corp. and Shearson Lehman Hutton Inc., which were jointly contracted by the government as consultants on the sale of the debt-ridden airline, recommended offering shares on local and foreign stock exchanges.
According to the proposal, Israel would offer 25% of El Al’s shares on U.S. and European stock exchanges and 16% on the Tel Aviv Stock Exchange. Ten percent of the shares would be sold to the airline’s employees.
El Al would have to agree to lift a seven-year-old temporary receivership before floating the shares. The airline has reported modest profits for three straight years but is still burdened by more than $200 million in debt.
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