Friday, August 29, 2008
TAHAL - A Difficult Life
TAHAL, Tichnun HaMaim LeIsrael, has a special place in my heart. Only a few days after landing in Israel, I started working for this company, and there was not one day that I did not feel I was lucky to work with such a wonderful people. Tahal was the national planner of water, then as now considered the key of the country's survival, working on large water supply and irrigation projects in Israel and all over the world. We were a group of people with a mission, very prestigious (almost like the Mossad, whose building we occupied), and well paid. From the 800 employees some 70% were engineers and 20% Ph.D.s. Our revered leader was Aharon Wiener, a wiry Hungarian Jew, and the company operated cost-plus, so money was never a problem. I loved Tahal.
When the era of the large water projects ended in Israel, in the seventies - eighties, the management tried to solve the sudden underemployment by by exporting water consulting services to Africa and Latin America, and branching out to related fields such as computer programming. It was very successful, but the mass of middle aged engineers lacked the language or the mental capabilities to engage in new areas. The company was sold to a foreign consultant with the promise that no one will be sacked (those were the last days of socialism is Israel, when people was never sacked), but after a few months was re-sold to an Israeli building concern. Before the sale, excellent conditions were offered to those willing to leave and who was the person standing at 0700 AM in front of the door? J in person. But only a few others took up the offer, as no one wanted to leave. But I had a better offer already and as always, had an urge to move.
Tahal was then sold once more to Joseph Grinfeld, Avner Schnorr and Eytan Richter's Kardan Holdings, and it is very much in the business papers, once because it signed a 100 M project in Turkey, the other time because it is starting a monster water project in China. So it was a surprise to read in Globes that in fact, Tahal was losing money and is being re-organized with a new CEO, Gustavo Kronenberg (pic). The man received options for 3% of the shares that can be sold when TAHAL is worth 40 M dollars. I know Gustavo and he has a long, difficult way ahead.
Tahal is estimated to be worth 16 M Euro, which is 10% less than the price paid by Kardan in 2001. Tahal completed year 2007 with a loss of 7 million Euro in a turnover of 75 M Euro. In 2006 it earned 1 M Euro in a turnover of 65 M Euro. But these mediocre results are hidden by the growing list of key water projects where Tahal is involved, all with enormous potential. Tahal, then, is an enigma for me, it is the number one company in the promising water infrastructure field, with large international projects, yet, losing money. This is an unexplainable paradox, and worse, I am suffering from the very same thing. Something is wrong, where is the money?