Probed Bezeq CEO to Step Down in July

On Monday, Israel’s largest telecommunication provider Bezeq announced the impending resignation of CEO Stella Handler, in connection with the investigation conducted against her and other senior executives in the company by the Israel Securities Authority (ISA) and Israeli police since June 2017.

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Ms. Handler has been Bezeq’s CEO since 2013, and will step down in July, according to a filing the company submitted to the Tel Aviv Stock Exchange.

As Bezeq’s CEO, she took part in the company’s 2015 acquisition of Israeli satellite television company Yes from Eurocom, a parent company of Bezeq, a deal which is at the center of the ISA probe. After the ISA investigation uncovered various securities violations performed, Ms. Handler was placed under arrest in February, and later released into house arrest and ordered to keep her distance from the company.

Along with Bezeq’s current controlling shareholder Shaul Elovitch, Ms. Handler is also implicated in "Case 4,000," which spun off the ISA case. Case 4,000 is an investigation into whether Israeli Prime Minister Benjamin Netanyahu gave Bezeq preferential regulatory treatment in exchange for positive coverage of Mr. Netanyahu and his wife Sara on Walla, a popular Israeli news site owned by the company.

Before taking on the position of Bezeq CEOת Ms. Handler served as the CEO of Israel-based communication company Internet Gold Golden Lines Ltd., which is one of the companies through which Eurocom Group and the Elovitch family control Bezeq.

The decision to resign is the right thing both on a personal level and for Bezeq, Ms. Handler said in a statement, adding that in addition to the investigation, the upcoming sale of Bezeq also factored in.

Mr. Elovitch and Eurocom are currently in around $430 million debt, mostly to Israel's three largest banks, and have been negotiating the company's sale—and with it the controlling stake in Bezeq—for several months now. A deal has been inked to sell the company to real estate developer and businessman Naty Saidoff, but recent pushback from some of Bezeq’s shareholders, who want to see outside directors fill the three positions vacated by the Elovitch family, has led Mr. Saidoff to capitulate last week, and the deal is currently off the table.