Agricultural Companies File for Stay of Proceedings Over 30M NIS Debt
Two agricultural companies founded by farmer Zion Swissa have filed for a stay of proceedings at the Be'er Sheva District Court, citing debts of 30 million NIS. The firms blame the COVID-19 pandemic, the Iron Swords War, and severe labor shortages for their financial collapse.
The agricultural crisis in Israel has reached the courtroom as two long-standing companies, "Mala Ha-Sal - Vegetable Marketing" and "Mala Ha-Sal - Fruits and Vegetables", founded by farmer Zion Swissa, have filed requests with the Be'er Sheva District Court for a stay of proceedings and the appointment of a settlement manager. According to the court filings, the companies operate in an integrated system and manage cultivation areas in Kibbutz Hazor, Be'erot Yitzhak, and Peza'el, as reported by ynet.
Data presented to the court shows that the combined debts of the two companies total approximately 30 million NIS. "Mala Ha-Sal - Vegetable Marketing" accounts for about 13 million NIS in debt, while "Mala Ha-Sal - Fruits and Vegetables" owes an estimated 17 million NIS. The companies attribute their financial crisis to a series of consecutive events, including the COVID-19 pandemic, the Iron Swords War, security escalations with Iran, international boycotts, and a severe shortage of agricultural workers.
The petitions state that the departure of foreign workers and the inability to recruit agricultural laborers from the Palestinian Authority led to the shutdown of cultivation areas and greenhouses, and in some cases, the rotting of crops in the fields. Additionally, surging prices for raw materials, fuel, packaging, and transportation increased operating costs by tens of percentage points. The companies supply produce to major Israeli retail chains, including Rami Levi, Shufersal, Yohananof, and Fresh Market, as well as other domestic market clients.
Alongside the request for a stay of proceedings, the companies have presented a potential lifeline: an agreement in principle has recently been signed with an external investor to inject 2.5 million NIS in exchange for a 50% stake in both companies. Simultaneously, a personal stay of proceedings has been requested for Swissa, with his attorneys arguing that this measure is essential to ensure the continued operation of the companies and to facilitate a settlement with creditors.
