When representatives of the Turkish group Yilport entered the courtroom in November, they were not told why they were going to be disqualified. From the tender to the port of Haifa. “The security of the state is an unknown secret and they did not bother to tell us why we were disqualified,” said attorney Amnon Epstein, who represents the group. Is finally disqualifying the group and is now considering petitioning the Administrative Court.
The intelligence information revealed the connection to the suspect’s port
In January 2020, the Ministerial Committee on Privatization made the decision to privatize all state holdings in the Port of Haifa to a buyer or a group of buyers who will meet various criteria such as relevant experience, economic resilience and financial soundness. The decision of the Ministerial Committee also stipulates that the security interests of the State of Israel will be examined.
The disqualification of the Turkish consortium was not due to its professional level. The company owns more than 20 ports in the Marmara Sea, the Mediterranean Sea, Scandinavia, the Iberian Peninsula and South America. Intelligence officials involved in the process told Globes that despite all this, the consortium was disqualified because one of its controlling shareholders, Turkish businessman Robert Yuxel Yilders, owner of Yilport, is also a board member of CMA CGM, one of the world’s largest shipping companies.
CMA CGM operates, among other things, the port of Beirut in Lebanon, the same port where Hezbollah operates. In August 2020, the horrific explosion of Hezbollah’s ammonium reservoir occurred in the port, killing more than two hundred people. Intelligence reports and overt publications point to a link between the CMA and senior Hezbollah operatives and the activities of the Shiite terrorist organization from Lebanon around the world. For example, the man in charge of the port and its operation – the Minister of Public Works and Transportation of the Lebanese government, Ali Hamaiya – is a Hezbollah man. The company also operates the port of Latakia in Syria, the same port used to transfer weapons from Iran to Hezbollah.
Much more extensive intelligence information was submitted by Israeli intelligence officials to both the Ministerial Committee dealing with it and the Tenders Committee, and this information was used to disqualify the Turkish consortium. It will be recalled that this group also includes the American Grayston, the British Global Ports – Turkish and the Israeli Oshnau. Yilport held 51% of the group and after it became clear that security forces in Israel opposed it, it reduced its holdings to 25% while Graystone took control. But as stated, this move was unsatisfactory, and the position of the intelligence agencies was decisive.
Yilport has grown 18 percent in the past year
In the first half of 2021, Yilport showed 18% growth over the same period in 2020, and its revenues increased by 19%. Yilport Holdings, founded only in 2011, is just one part of a group of Yildirim companies that entered the ports industry only in 2004, but dominates many industries, including metals and mining, chemicals, energy and international trade.
The company’s CEO is Robert Yoxel Yildirim, who also serves as president of the Yilport Samsonspor football team, which plays in the Turkish sub-league. The Yildirim team employs more than 14,000 people in its business, spread over 51 countries on five different continents. Because its main sources of income were ports (31%), mining and metals (24%), fertilizers and chemicals (14%), energy (9%), logistics (7%), coal (5%), and shipping (4%).
A source close to the issue told Globes that despite its growth, Israel can not afford that the port of Haifa, which is an essential infrastructure anchor for the country, will be under the control of a company that may have indirect ties with Hezbollah. “The intelligence information is clear,” the source claimed. “The risk, even if it can be viewed as theoretical, did not allow for another decision.”
The decision is not expected to harm the normalization process
About two and a half months ago, the ports giant from the emirates, DP WORLD, withdrew from the tender and competed in partnership with the Israel Shipyards Company, which is controlled by Shlomi Fogel. We then reported that DP’s resignation was made after a hearing was held before Finance Ministry Director General Ram Blinkov, during which it was made clear to its representatives that for security reasons it would not be able to control the port.
But there were probably other reasons for this retirement as well. In late November, Emirates Regent Muhammad bin Zayed visited Turkey and met with President Erdogan. Following the well-publicized visit, the UAE announced a $ 10 billion investment in ventures in Turkey. A few days later, the announcement of DP WORLD’s retirement from the Haifa auction arrived. According to estimates by well-involved parties, the retirement was intended to clear the Turkish Lailport area and reduce competition between the companies. The area has been vacated, but Yilport will not be able to capture it.
The Israeli decision to disqualify Yilport’s candidacy was not taken by surprise in Turkey. Dr. Chai Eitan Cohen Inrojek, an expert on Turkey at the Moshe Dayan Center at Tel Aviv University and the Jerusalem Institute for Strategy and Security, told Globes that “trust has not yet reached a level where Israel can allow a Turkish company to own a port.” However, he is optimistic: Now this should not be an obstacle. “Once the normalization is realized, it may be possible for Turkish companies to participate in tenders.”
Gokhan Chinkara, Turkey’s “Independent” commentator on Israel, told Globes that “disqualifying Yilport will not affect the normalization process between the two countries.” Regarding the way in which the normalization process between Turkey and Israel is perceived by the Turkish public, Chinkara notes that the reactions are mixed. “The secularists are satisfied, the conservatives are carefully examining President Erdogan’s steps, while the Islamists have already expressed their dissatisfaction with what is happening,” the Turkish expert said.
The decision may be justified, but the message is problematic Amiram Barkat, commentary
The Turkish group, which was rejected by the state this week, was one of the most interesting participants in the tender for the privatization of the port of Haifa. It includes Yilport, which operates over 20 terminals around the world, GPH, which is considered a world leader in the development of cruise docks, and tourism and commercial complexes (speaking of the plan to develop the Seafront Project in Haifa) and Greenstone from the USA. The owner of the Turkish company, Robert Yildirim, because the only serious rival in the tender for him is DP-World from the United Arab Emirates, which approached the tender together with the Israeli shipyards and businessman Shlomi Fogel.
But the DP, which came here with big plans, withdrew from the tender itself two months ago. The retirement was apparently due to her refusal to relinquish control of the competing group. The retirement of the port giant from Dubai and the disqualification of the Turkish Yilport may have been due to justified reasons in themselves from the state, but they do not serve the Israeli interest in attracting leading companies from the Middle East and encouraging collaborations with local companies.
Beyond the political and image aspects, the question arises as to where the tender for the privatization of the port of Haifa, which was launched with great fanfare almost a year and a half ago, is headed. Of the 18 groups that approached the tender in October 2020, 3-4 bidders remain today, according to the publications: Unger Group, which specializes in importing cars, the Indian Adani Group with Keren Tene, Shafir Engineering and the Sea of Oats and Israel Shipyards. Among the remaining contenders, there are no companies with experience in operating ports on the scale of the emirate company nor specialization in the development of port tourism and commercial complexes like that of the Turkish group. Currently, the tender is delayed by about a year compared to the original schedule. If the Turks decide to appeal to the court against their disqualification, the process could be delayed for several more months.
But the state, it seems, is still far from saying desperate, and spares no effort to keep the tender alive. Last month, for example, it initiated an 8% discount for contestants who submit bids. The numerical example attached to the announcement of the discount refers to proposals of NIS 2.5 and 3 billion. These sums seem very optimistic today, but who knows, maybe the endless traffic jam at the port gates, and the stuttering in the operation of the competing private port, of the Chinese SIPG, will help the Treasury still find a serious buyer for the port of Haifa.