Tycoon's 'pipe-dream' was to gain control of Israeli airline

The Maxwell Trial; Day 3

JOHN WILLCOCK

Financial Correspondent

Robert Maxwell was feted in Israel as its biggest foreign investor and even had the "pipe-dream" of gaining control of El Al, the national airline, an Old Bailey fraud trial heard yesterday.

It was a pipe-dream because El Al was not for sale, solicitor Michael Fox said. Mr Maxwell also tried to buy two Israeli football teams.

Mr Fox, of Herzov Fox and Neeman, formerly legal advisers to Robert Maxwell and his companies, said that Maxwell began to invest in Israel in a big way from 1988. He was giving evidence on Day 32 of the trial of Kevin and Ian Maxwell on charges of conspiracy to defraud.

In 1988, Maxwell dined with the President and other dignitaries. He was well regarded because he did not tie his huge investments to demands for favours.

Maxwell became chairman of Scitex, a successful Israeli company. Shares in Scitex were held by the Maxwell pension fund company, Bishopsgate Investment Management.

Mr Fox revealed that, before his death in November 1991, Maxwell had been trying to gain control of Israeli Chemicals, the Israeli Discount Bank and the Jerusalem Post.

He had also been involved in plans to launch an Israeli bonds drive in the UK to raise money for Israel and was trying to buy two soccer clubs, one in Jerusalem. He had bought an 80 per cent controlling interest in the country's second-largest newspaper, had founded Vremia, a newspaper printed in Russian, and was in negotiations involving Clal, a large group with electronic interests, and the Discount Corporation, a discount investment group.

According to Mr Fox, Maxwell's attitude to the companies he did acquire was: "They were all part of the same pot. They were all his and his to deal with."

Mr Fox said he believed the tycoon was also involved in charitable activities in Israel but he did not have details.

In the dock are Maxwell's sons, Kevin and Ian, and two former Maxwell aides. All deny conspiracy to defraud. Kevin alone denies conspiring with his father to defraud the pension fund by misuse of pounds 100m of investments.

The trial continues today.