Hiding the loan of Pavilion Wines: “Rumors can go bankrupt”

Although the closure is in progress, the Tel Aviv District Court heard yesterday (Sunday) the NIS 35 million loan case for the Bitan wine chain, including the version war between the chain’s current management and the founder, Nahum Bitan. During the hearing, businessman Benjamin Baron claimed that the loan he gave through Lev Baron was hidden at the request of his friend and chain founder Nahum Bitan, and in a cross-examination he testified that the intention was “not to let the market know that Bitan took a loan.”

It was also learned that yesterday, after an informal hearing was held in court outside the protocol between the network, Bitan and Lev Baron, the parties reached an understanding to end the entire case. The parties announced that they needed a short stay to put the understandings in writing and reach agreements. Judge Oded Maor scheduled another hearing for January 17.

The hearing took place following a request by Lev Baron Commodities, represented by attorney Gilad Bergman, to grant temporary foreclosure orders in the presence of one party against Pavilion and the network on the grounds of non-repayment of the loan – a request that was denied in the presence of one party. Last week, Bitan asked the court, through attorney Erez Der Lulu of the Lipa Meir law firm, not to impose temporary foreclosures on his accounts, but to accept the request to impose temporary foreclosures on the network under its current management, as it claims it “unduly denies its obligation to repay the loans. “Her behavior under the current management headed by Shlomo Rodev is unfair and unacceptable.” On the other hand, the network claimed that the factor that owed Lev Baron was the pavilion itself and not the network.

In an affidavit filed by Baron as an appendix to the foreclosure application, he stated that a year after the purchase of Mega, Bitan Wines ran into a cash flow crisis and Bitan approached him on Sukkot 2017 “against the background of our friendship” and asked them to lend Bitan millions of shekels to pay employees before the holiday, pay suppliers, “Bitan requested that the loan and the source of the funds be kept secret, so as not to aggravate the rumors that were circulating about the cash flow situation of Bitan Wines, and pledged that he would make every effort to repay the loan within a few weeks,” he noted.

According to Baron, due to this request, the funds were transferred from Lev Baron’s account to a company owned by Baron’s brother, and from there to a private company owned by Bitan (B. Bitan Properties), which transferred the funds to the chain’s account that day. Bitan Wines, represented by Adv. Israel Pepper of the Meitar firm, claimed that the loans were registered in the library as Bitan’s owner loans and that this was how things were presented, and only in the last two months has Bitan presented to the company’s management.

Yesterday, as stated, before the parties reached an understanding, the hearing began with Baron’s cross-examination by Adv. Pepper, who quoted Pavilion’s response to the court, in which he stated that “everything was done openly and in the sun and without any attempt to hide, God forbid. It is a company of Lev Baron and that their destination is the Bitan Wines chain. “

Advocate Pepper: “Is the aforesaid true? Would you agree with me that Mr. Bitan asked you to hide the loan? “

Baron: “The publication will be hidden, that they did not know he had received a loan.”

Adv. Pepper: “And also that they did not know the source of the funds.”

Baron: “No. The source of the funds is not interesting. I have no problem knowing they gave me a loan.”

Advocate Pepper: “In the affidavit you stated that Bitan requested that the grant of the loan and the source of the money be kept secret. From whom? “

Baron: “From the people. From the suppliers … the whole idea that it did not come out that he took a loan. The banks knew. The bank’s VPs knew. I picked up the phone to them before I gave the loan and said ‘I give a loan’ “.

Attorney Pepper: “So the first loan goes to your brother’s company and from there to Pavilion’s company?”

Baron: “Right. From my brother it passed to a company that Bitan wanted to transfer to. My brother is a pipeline, he transferred the money so they would not know. I have a loan agreement with Bitan Wines. The whole idea was that they did not know he was taking a loan because of the sensitivity. The loan was given to Bitan Wines. I made three transfers: the first, for NIS 15 million, was transferred to a company owned by my brother. From there it was transferred to Bitan Properties and then to Bitan Wines. After that we transferred a NIS 15 million loan from my company to Bitan Wines directly. 5 million directly to Pavilion Wines. “

Adv. Pepper: “At the time the loan was granted, the condition of Pavilion Wines was before insolvency?”

Baron: “A company should not go bankrupt. Only rumors can go bankrupt.”

Advocate Pepper: “Is it true that if the loan had not further explained that Pavilion Wines would have fallen into insolvency?”

Baron: “That’s what I thought.”

Last week, Bitan Wines filed a response in court with an affidavit by Shlomo Rodev, the chain’s chairman from July 2020. According to him, Lev Baron’s claim that the chain’s economic situation is “shaky” is a false presentation that does not exist.

Adv. Pepper: Bitan asked that the loan be kept secret. From whom?

Baron: “From the people. From the suppliers … the whole idea that it did not come out that he took a loan”

The conflict with Lev Baron is the result of a struggle for control that is taking place in Bitan Wines between founder Nahum Bitan and chairman Shlomo Rodev. The chairman, appointed by the banks, is promoting a deal whereby the Phoenix insurance company will buy 45% of the chain for NIS 450-400 million. The company will then be issued, and thus Pavilion will lose control. Pavilion objects on the grounds that the value of the network is more than double.

Pavilion’s attempts to thwart are, among other things, the reason that Rodev makes it difficult for him and opposes that the chain pay the loan that Bitan took from the heart of Baron and the foreigners to the chain in order to strengthen its difficult financial situation at the time. Rodev claims that a personal pavilion must repay the loan. Pavilion for its part is trying to find an investor on its behalf who will be willing to invest at a higher value. He allocates the investment money to the payment of the network’s loans in the amount of NIS 250 million to the creditor banks, thus freeing themselves from their “shackles” and slashing the Phoenix transaction.

Mammon and Ynet have learned that Bitan was recently in negotiations with Zehavit Cohen of Apax to enter as a partner, but in recent days it has decided not to go for the deal. According to Bitan’s associates, if he does not find an investor, he will sell about 30-20 branches and recruit through Selling the money needed to repay the loan to the banks.

Although he does not control the chain’s shareholder’s pavilion, this is because the chain’s hardship after the mega acquisition forced him a year ago, at the request of the banks, to relinquish his actual control and management, in exchange for an additional credit line of NIS 150 million.

Nevit Sommer participated in the preparation of the article