El Al: Antitrust Authority halts El Al's Maman Cargo Terminals cargo agreement

Antitrust Authority to El Al and Maman: the arrangement in which Maman would award El Al discounts "is liable to constitute a cartel and an abuse by a monopoly”
 
El Al Israel Airlines informed last week the Tel Aviv stock exchange that Israel's Antitrust Authority director general Ronit Kan had decided to block a deal between El Al and Maman Cargo Terminals pending a review of concerns that the tie-up could undermine air cargo competition.
 
In a letter to the Tel Aviv stock exchange El Al noted that the Antitrust Authority director general advised the CEOs of El Al and Maman, that the arrangement in which Maman would award El Al discounts and provides shares and options to the airline "is liable to constitute a cartel and an abuse by a monopoly,".
 
Ms Kan told the two companies "to avoid implementing the agreement until the legality of the arrangement" is determined.
 
Under the agreement signed earlier this month, Maman would allot 15% of its shares to El Al, half of them when the deal is signed, a quarter at the beginning of 2011, subject to the first extension of the agreement, and the final quarter at the beginning of 2012, subject to the second extension of the agreement.
 
The two companies are understood to be studying the Antitrust Authority's position.