The Reach of Rassco

Old Nazareth has hardly changed since the days when the young Christ walked its streets--the hard-pressed Nazarenes subsist, as their forebears did, by tending tiny shops or grazing sheep on the windswept hills. But above the Biblical old town sits a new Nazareth, settled by 8,000 Jews who take their economic lessons from the Book of Progress. The new town boasts a textile mill, chocolate-processing plant, 750-seat movie theater and 48-store shopping center. Being built is an 80-unit housing development whose windows overlook Mount Tabor, the site of Christ's Transfiguration, and nearby Cana, the scene of his first miracle. The new Nazareth is the work of Rassco, a broad-ranging corporation that has become Israel's largest private employer.

Six-Language Sales Talk. Rassco (for Rural & Suburban Settlement Co. Ltd.) was originally set up 30 years ago by the World Zionist Organization to lay out and stock farm communities for middle-class German Jewish refugees. But as Israel gradually became agriculturally self-sufficient, Rassco's horizons widened. The company still raises sheep in Samson's Ashkelon, and cattle on the plains of Maresha where Joshua's army marched. But through a string of 52 subsidiaries and affiliates, Rassco is now involved in citrus groves, organic fertilizer, dairies, Bible publishing, diamond polishing, supermarkets, North Atlantic fishing boats, hotels and high-rise apartments. In 65 Israel communities, 93 Rassco building projects are underway; the biggest is a 28-story skyscraper in Tel Aviv. Altogether, on a gross turnover of $60 million last year, Rassco made a profit of $1,000,000. The parent company paid dividends of 10% .

Such a return, coupled with Rassco's diversification and Israel's improving trade balance, have made Rassco an attractive investment outside Israel. Managing Director Mordechai Stern, 49, a scholarly onetime Viennese medical student who speaks six languages, divides his time between pushing projects and pulling in foreign capital through nine overseas offices. Rassco has 10,000 investors in 25 countries, but of the $12 million they poured in this year, 75% came from the U.S. "They are doing something good for the country," says Stern fondly of his alien investors (now 60% of Rassco's shareholders), "while knowing that their money is safe."

Tourists for Sodom. Many outsiders who begin as shareholders eventually move into actual property ownership by buying a Rassco enterprise and letting Rassco manage it for a fee. Nazareth's new buildings, for example, are largely owned by Memphis, Tenn., investors. With Rassco, several British millionaires, including Sir Isaac Wolfson and Charles Clore, jointly own G.U.S.-Rassco Ltd., a company affiliate that sets up small industries. Stern is happy to sell off enterprises quickly; sales give foreign investors material and emotional ties to Israel and, more importantly in a capital-short nation, provide funds for further enterprises. Already, although the Tel Aviv skyscraper is only 50% complete, Stern has sold off practically all Rassco's interest in it to Britain's Wolfson Clore Mayer Corp. Now he is planning a tourist center at Tiberias and a resort hotel beside the natural springs of Sodom.

This file is automatically generated by a robot program, so reader's discretion is required.