Elscint to focus on hotel, leisure sectors

September 15, 1999

Elscint and its parent company Elbit Medical Imaging have announced a restructuring that will focus the Haifa, Israel-based firm’s activities in the hotel and leisure sectors. As part of this plan, Elscint has acquired the hotels division of Europe

Elscint and its parent company Elbit Medical Imaging have announced a restructuring that will focus the Haifa, Israel-based firm’s activities in the hotel and leisure sectors. As part of this plan, Elscint has acquired the hotels division of Europe Israel, which is the controlling shareholder of EMI. Elscint has also acquired an entertainment and commercial center. The impact on Elscint’s medical imaging assets was not immediately clear.

Earlier last week, Elscint and EMI announced that EMI has decided to terminate discussions on the proposed business combination between the two companies. Elscint had received an offer earlier this year for the purchase of their outstanding shares for about $200 million (SCAN 3/3/99).

Elscint’s recent business decisions have not been popular with all of its shareholders. Shareholder and former president Yonatan Aderet has filed a claim in the District Court of Tel Aviv, alleging that the former directors of the company caused damage to the company and discriminated against the firm’s minority shareholders by their actions, including their decisions regarding the sale of Elscint’s assets.

Aderet’s motion was submitted on behalf of all existing shareholders of the company, who were either shareholders or holders of options convertible to company shares before Nov. 5, 1998. He has requested that the company be ordered to purchase from each member of the represented group all shares held by them at a price of not less than $28 per share. Alternatively, he has requested that Elscint be directed to publish an acquisition proposal for the purchase of its shares held by the public at a price of $28. Elscint believes Aderet’s claim is devoid of factual and legal merit, and intends to vigorously oppose it.