Markstone Capital Partners Group LLC, headed by Ron Lubash, will be allowed to carry out the contract signed with the controlling shareholders in Zeraim Gedera to acquire their 62% stake in the company, ruled arbitrator Adv. Dr. Yoram Danziger. The Tel Aviv District Court appointed Danziger to arbitrate the dispute.

Danziger ordered Zeraim Gedera to transfer to Markstone by November 23 all necessary documents and information needed to carry out due diligence. Markstone and Japan’s Sakata Seed Corporation to each pay a third of the cost of the arbitration proceedings of NIS 130,000. Zeraim Gedera’s minority shareholders will pay the other third, on the basis of their stakes in the company.

Markstone asked the court to forbid Zeraim Gedera’s majority shareholders from accepting a request by the company’s minority shareholders (who own 32.28% of the company) to sell their shares to the minority shareholders. Markstone claims that this is an attempt to block its attempt to acquire control of the company for $52 million. Markstone claims that Zeraim Gedera’s minority shareholders are trying to exercise their rights on behalf of Sakata, who would buy the majority shareholders’ stakes for $52 million and subsequently sell it to Sakata for $55 million. Sakata is represented in Israel by Hazera Genetics Ltd. (TASE: HQS), a competitor of Zeraim Gedera.

Zeraim Gedera develops, produces and markets vegetable seeds. It is a private company owned by farming families from the town of Gedera. It has a sales turnover of $100 million a year, and exports to over 30 countries.

by Noam Sharvit, Globes [online], Israel business news - www.globes.co.il