The Israeli government is reportedly considering dismantling some of the country’s largest conglomerates in order boost competition and, by doing so, help reduce prices. A further move, though with probably more long-term effect, might be the vesting of increased power to minority shareholders in complex companies that have many tiers of subsidiaries, giving those minority shareholders the power to veto major acquisitions and the issuing of debt or equity. At present, Israel has one of the highest concentrations of corporate power in the developed world: itss 10 largest business groups control a remarkable 41% of the market value of public companies.
A further recommendation is that Israel’s Antitrust Authority be given greater powers in order to tackle undesirable concentrations and to increase competition.
Source: “Israel Looks to Break Up Conglomerates” by Ari Rabinovitch and Tova Cohen, Reuters, 19 September, here