Terayon Communication Systems Inc. (Nasdaq: TERNE) chairman and controlling shareholder Zaki Rakib is leading a group of investors negotiating with Hutchison Telecommunications International to acquire the controlling interest in Partner Communications Co. Ltd. (Nasdaq: PTNR; TASE:PTNR; LSE:PCCD).
Rakib’s partners are LR, a group of former El Al pilots, which invests in a number of areas, other Israeli entities, and foreign investment funds.
Negotiations have gone on for two months, and are now at the stage of exchanging drafts. The Zellermayer, Pelosoff & Co. law firm represents Rakib’s group. Sources close to the group say the negotiations have already gone beyond the preliminary stage, and have a better than 50% chance of success.
The sources added that the negotiations are being held for less than the $900 million price Hutchison reportedly asked for from the owners of cable companies joint brand, HOT. Partner CEO Amikam Cohen is reportedly aware of the negotiations.
Egypt’s Orascom Telecom (LSE:OTLD; CASE:ORTE) recently acquired 19.3% of Hutchison Telecommunications International, and probably plans to increase its stake in the company. There is now pressure on Hutchison to sell its stake in Partner, because a problem will arise if Orascom Telecom gains a larger stake in Partner.
In recent months, HOT has been negotiating with Hutchison to acquire Partner. Hutchison reportedly asked for $900 million for its 51.85% stake in Partner, while HOT’s owners have agreed to $750-800 million.
Published by Globes [online], Israel business news - www.globes.co.il - on January 15, 2006