Thyssenkrupp says firm tied to PM not involved in its submarine manufacturing

Thyssenkrupp says firm tied to PM not involved in its submarine manufacturing

Statement by German defense contractor seems to refute claims by Netanyahu rivals that he profited from naval vessel deals, but premier still in hot water over Egypt deal approval

A general view of the headquarters of German heavy industry giant ThyssenKrupp AG in Essen, Germany, on December 11, 2012 . (AFP/ Patrik Stollarz/File)
A general view of the headquarters of German heavy industry giant ThyssenKrupp AG in Essen, Germany, on December 11, 2012 . (AFP/ Patrik Stollarz/File)

A German shipbuilder at the center of an Israeli corruption scandal that has been tied in recent weeks to Prime Minister Benjamin Netanyahu denied Sunday that it builds submarines with parts purchased from a company that had a business affiliation with the premier.

The high-profile Case 3000 investigation has ensnared several close associates of Netanyahu, but not the premier himself, on suspicion that they received illicit funds as part of a massive graft scheme in the multi-billion-shekel state purchase of naval vessels and submarines from German shipbuilder Thyssenkrupp.

In recent weeks, new suspicions have emerged that Netanyahu may have profited from selling shares in a company to his cousin, US businessman Nathan Milikowsky, who is a supplier to Thysennkrupp.

The company, Seadrift Coke, produces needle coke, used for manufacturing graphite electrodes. These, in turn, are used in furnaces for steel production and used to make submarines. In November 2010, Seadrift was acquired by a conglomerate in the same field, GrafTech International, a longtime supplier of Thyssenkrupp.

On Sunday, a Thyssenkrupp official seemed to rule out any conflict of interest or connection between the company Netanyahu was affiliated with and the submarine deals he approved.

Prime Minister Benjamin Netanyahu aboard the new submarine ‘Rahav’ at the Israeli navy base in Haifa, on January 12, 2016. (Kobi Gideon/GPO/File)

“GrafTech is one of the Thyssenkrupp Group’s hundreds of thousands of business partners, with sales volumes in the low range,” the official, Tim Proll-Gerwe, told Israeli journalist Erel Segal of Radio 103FM. “But there are no business relations with the marine division.”

Marketing materials for GrafTech list Thyssenkrupp as one of the company’s largest customers.

Netanyahu and his party members were quick to use Thyssenkrupp’s statement to accuse election rival Benny Gantz and his Blue and White party, who have been pushing the claim that Netanyahu made a personal profit from the submarine deals with Thyssenkrupp, calling it a “blood libel.”

The State Prosecutor’s Office is reportedly considering a criminal probe against Netanyahu for failing to report his stock dealings to authorities, albeit not for their connection to the submarine deals.

According to a Channel 13 report on Thursday, prosecutors suspect Netanyahu misled the State Comptroller’s Office with regard to his financial assets.

Benny Gantz, in a video released by his party, on March 23, 2019. (screen capture: Channel 13)

Gantz and his party have made suspicions around Netanyahu’s links to submarine sales a central component of their campaign, including allegations that the prime minister was acting improperly when he green-lighted a Thyssenkrupp submarine sale to Egypt in 2014 or 2015, without notifying the IDF chief of staff — Gantz — or the defense minister — Moshe Ya’alon, No. 3 on Blue and White’s Knesset slate.

According to a 2017 report by Channel 13 news, Netanyahu green-lighted the sale, despite the objections of top security officials who voiced concerns over supplying sophisticated submarines to Egypt.

During a rare and contentious interview with Channel 12 news on Saturday, Netanyahu accused his main political rivals of a “blood libel” against him and said they were trying to force him to divulge state secrets by making an issue out of Israel not objecting to the Egypt deal.

“Whoever needed to know, knew,” Netanyahu said, adding that Ya’alon was not among them.

Moshe Ya’alon, left, and Amos Yadlin (photo composite: Tomer Neuberg/Flash90)

In response, Gantz said in a video message: “Are you listening to yourself? Do you hear what you are saying? To talk about selling submarines as if its the personal decision of the prime minister without consulting with the defense minister? Without consulting with the IDF chief?”

Former head of the IDF Military Intelligence Directorate, Amos Yadlin, told Army Radio Sunday that the decision was “extremely unreasonable” and called for a state probe into the matter.

“The prime minister admitted he didn’t share [the information with] his defense minister and IDF chief of staff,” Yadlin said. “The issue of provision of weapons to a neighboring country involves what is known as preserving Israel’s qualitative advantage. The Defense Ministry is in charge of that and it is unreasonable that the defense minister would be kept in the dark.

“The next step in my opinion would be a probe or a commission of inquiry to check if Israel’s security was harmed because of improper decision-making.”

Times of Israel staff contributed to this report.

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