Arkia employees seek rival bid to block $45 million sale

Employees of Arkia Airlines are urgently searching for a rival investor to challenge a newly signed $45 million sale agreement. The deal, which was finalized by a group of private investors, aims to secure control of the carrier. Employee representatives have a strict deadline of Monday afternoon to present a competing offer that matches the terms of the signed contract.

The negotiations concluded in the early hours of the morning, around 3 a.m., after an intense session between the airline staff and the prospective buyers. The buying group is led by Yariv Lerner, Kidan Dahari, Yaron Adiv, and Einav Adiv-Berar. Since the talks ended, employee representatives have been in contact with several other potential investors. They are evaluating which parties can match the financial terms, what their strategic plans for Arkia are, and what concessions they are willing to offer regarding the workforce.

If the employees can secure an investor willing to meet the specific terms and agree on the future direction of the company, they will submit their counter-proposal by the Monday deadline. The primary deal involves an injection of approximately $45 million into the airline. Of this amount, the new buying group will contribute roughly $30 million in exchange for control of the company. The remaining funds will come from brothers Rafi, Joe, and Avi Nakash, as well as the state. The Nakash brothers will retain a stake of about 3 percent in the enterprise.

Prior to the sale, the employees held approximately 22 percent of the company through their employee corporation. The announcement of the deal did not clarify how much of this ownership stake would remain in the hands of the workers. The sale follows recent developments where Israir, Arkia’s main domestic competitor, announced it was in preliminary talks to acquire the airline. Israir CEO Uri Sirkis told staff that a merger would create a larger entity capable of competing with foreign carriers. Currently, Arkia holds a market share of nearly 11 percent of passengers at Ben-Gurion Airport in 2026, while Israir holds 12 percent.

The dynamic of the negotiations has been complicated by shifting alliances. Until the final signing, Lerner, who chairs the Negev Ceramics Group, was part of a consortium considering a purchase alongside the employees, the Varor family, and Avi Elkayam. Simultaneously, Dahari and Yaron Adiv, who own real estate companies Yashpro and Tnuport, were in discussions with Avi Hormaru, who represented the Nakash brothers. Ultimately, Lerner joined forces with Dahari and Adiv, and Einav Adiv-Berar, Yaron’s sister and a medical center owner, also joined the group. This left the employees negotiating against individuals who had recently made a joint offer with them.

Tensions between management and staff have escalated in recent weeks. Dozens of employees demonstrated outside company offices last week to protest plans to dilute their ownership stake. On Thursday, hours before the sale was officially announced, the Transportation Workers’ Union of the Histadrut labor federation declared a formal labor dispute. The union stated that company owners were pushing for workforce reductions and the cancellation of routes without reaching agreements with employee representatives.

Financial pressures have driven the urgency of the sale. Estimates suggest that Arkia lost approximately $30 million during the first three quarters of the year. The company could finish the year with a loss between $50 million and $60 million, although Arkia has previously noted that public estimates are not its official figures. The Nakash brothers have stated that they are working to resolve the crisis facing the airline with the goal of rehabilitating the company.

Even if the workers do not have a fully formed competing offer by Monday afternoon, negotiations with the group that signed with the Nakash brothers will continue. A source involved in the discussions expressed optimism, stating that they believe agreements can still be reached with the current buying group.