The rift between the owners and Shimon Mizrahi's secret card: the new shake-up at Maccabi Tel Aviv
The champion and cup holder has gone through another drama, as Richard Deitz announced the exercise of his right of first refusal on the sale deal to Jason Levien. What is behind this decision? What made him angry at the other owners? And how can the legendary chairman turn things around? Ynet sorts it out.
A new chapter in the power struggles at Maccabi Tel Aviv. After the champion and cup holder went through two shake-ups in its ownership structure, Richard Deitz, who held 17.5 percent of the club's shares until now, announced the exercise of his right of first refusal on the 38 percent intended to be sold to the Jewish-American businessman Jason Levien. What caused this? What happened in the last week? Why did Deitz get angry at the other shareholders? And what else could happen in just a few days? Ynet sorts it out for you with all the details.
Who is Richard Deitz? Richard Deitz, 61, is the founder and president of VR CAPITAL GROUP, an asset management company established in 1998 that currently manages assets worth about 2 billion dollars for institutional investors, family funds, and select private investors. Deitz has a degree in economics and history from Yale University, and he is a member of the "President's Council on International Activities" and the advisory board to Yale University. In 2013, he became a co-owner of Maccabi Tel Aviv when he purchased 17.5 percent of the team's shares.
How did it all start? The Federman family wanted to sell 14.5 percent of their shares to the club's main sponsor and CEO of Rapid, Arik Shtilman, in a deal that also included the entry of brothers Ziggy and Mark Wilf, the Jewish-American billionaires who own the NFL's Minnesota Vikings. Those who prevented their entry were Udi and Shi Recanati, who decided to exercise the right of first refusal that they had according to the contract between all the owners, purchased all 29 percent of the Federmans - and thus completely removed them from the club. After that, as first reported by Ynet, the Recanatis announced the sale of the 29 percent they purchased from Federman to Jason Levien, and thus again activated the right of first refusal of the other shareholders, with the deadline being in two days (September 6).
In parallel with this deal, in the last week, the shareholders announced another sale of shares to Levien, essentially from the shares they hold themselves. The Recanatis sold 7.5 percent of their 29 percent, Shimon Mizrahi sold 6.5 of his 14.5 percent, and Ben Ashkenazi sold about 9 percent of the 10 percent he had in his possession.
What angered Deitz? Sources familiar with the details say that the tension between Deitz and the Recanati family began already after they exercised the right of first refusal on the deal between Federman and Shtilman, which was supposedly done without prior notice to the other shareholders. Deitz was also angry about the decision to sell those same shares to Levien without being updated about it in advance. "Here they already woke the bear," said those same sources. What added even more fuel to the fire was the sale of the other owners' personal percentages to Levien, which would have allowed Levien to hold a total of 52 percent of all the club's shares and effectively gives him control over Maccabi Tel Aviv. "This is essentially transferring control of the club to a person who hasn't even stepped foot here for one day," explained another source.
What will the ownership structure look like now? Deitz effectively exercised the right of first refusal on the 29 percent that the Recanati family wanted to transfer to Levien and additionally exercised the right on Ashkenazi's 9 percent. In doing so, he increased his holdings immediately from 17.5 percent to 55.5. Likewise, he intends to turn to legal channels regarding the 14 percent that Recanati and Mizrahi wanted to sell to Levien from their personal shares, claiming that regarding this deal as well he can activate the right of first refusal, even though in the shareholders' agreement Recanati and Mizrahi have the option to sell a small part of their shares without the right of first refusal being activated. However, apparently Deitz found some loophole in the agreement.
What else could happen? In fact, there is until September 6 to exercise the right of first refusal on the deal between Recanati and Levien (on the 29 percent) so that both Mizrahi and Ashkenazi can exercise it and thus divide these 29 percent together with Deitz. However, there is a very important detail in the shareholders' agreement that allows Mizrahi, as a director at the club, to purchase over 26 percent of the 29 in a deal of this type, and thus effectively buy most of the shares that Recanati wanted to sell to Levien, which may take Levien completely out of the picture and thus dilute Deitz again.
