A FX/CFD tech
partnership that generated millions in wealth has reached its breaking point,
with an Israeli economic court ordering the sale of fintech company Panda
Trading Systems to a third party after years of escalating conflict between its
equal shareholders, according to the Israeli media outlet TheMarker.com.
Tech Partners’ Bitter
Split Forces Court to Order Panda Trading Systems Sale
Samuel
Gutman and Maor Lahav, who founded Panda in 2007 and each
own 50% of the company, failed to establish any mechanism for resolving
disputes or separating their interests. The court noted this oversight created
significant potential for expensive and lengthy legal proceedings when
disagreements emerged.
The
Haifa-based fintech company, which develops software solutions for foreign exchange
(FX) and contracts for difference (CFDs) brokers and employs dozens of workers,
had thrived for years under the partners’ joint leadership. However, by late
2020, trust between Gutman and Lahav deteriorated significantly, leading to
what the court described as an intense dispute.
Since 2022,
the court has been forced to intervene repeatedly in the company’s operations.
In an unusual move, Judge Dr. Muhammad Ali previously removed Lahav from the
board of directors and appointed accountant Yair Shalhav as a decisive director
empowered to break deadlocks on controversial issues.
Panda has
been collaborating with various brokers in
the FX/CFD industry for years, offering solutions that enable the launch of
a new trading firm from scratch within 30 days. In recent years, its
partners have included Moneta Markets, which has leveraged its tools to create
a new web-based platform for retail traders.
Changed Positions Complicate Resolution
While both
partners initially agreed separation was necessary, the method proved
contentious. According to court documents, Lahav initially supported selling
the company to a third party but later reversed his position, demanding Gutman
purchase his shares based on the company’s historical value from early 2021.
The court
ruling indicates Judge Ali found Lahav’s shifting stance problematic, noting it
could be dismissed under the principle of “judicial estoppel” – which
prevents parties from taking contradictory positions in the same legal
proceeding.
The court
also noted that Lahav had made serious allegations that could potentially
damage the company’s value and sale prospects during the proceedings.
After
examining the case merits, Judge Ali determined that selling to a third party
represented the most equitable solution for both parties. The court concluded
this approach preserves the relationship between the parties, allows for a fair
price for both sides, and will bring a final end to the dispute by severing the
relationship, particularly given the sour relations and complete lack of trust.
What’s Next for Panda
The court
has tasked decisive director Shalhav with developing a detailed plan for
selling the company or its operations, including subsidiaries, which must be
submitted to the court for approval.
Additionally,
the judge granted the company’s request to disconnect Lahav from all company
systems and prohibited him from sharing any company information with third
parties, citing concerns over potential misuse of sensitive data.
“The
comprehensive and thorough ruling constitutes a principled legal decision in a
situation requiring ‘separation of powers’ between warring shareholders, in the
absence of a dispute resolution mechanism or defined separation method in a
company’s founding documents,” attorney Yotam Blauschildt of Herzog law firm,
representing Gutman, commented for TheMarket.com.
“It’s
appropriate to learn from this case that it’s advisable to consider these
mechanisms in the early stages of establishing any company.”
Lahav was
represented by attorneys from Goldfarb Gross Zeligman, who did not provide
comment on the ruling.
This article was written by Damian Chmiel at www.financemagnates.com.
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