Leader Holdings and Investments Ltd. (TASE: LDER) subsidiary Leader Capital Markets Ltd. (TASE:LDRC) is paying Yelin Lapidot - Mutual Funds Management Ltd. co-founders Dov Yelin and Yair Lapidot an additional NIS 4.7 million on top of the original payment for the acquisition of half of the company two years ago. In the original deal, Leader Capital Markets acquired half of Yelin-Lapidot for NIS 15 million.
The deal was one of the most rewarding acquisitions in the Israeli financial market. At the time of the acquisition, Yelin-Lapidot managed NIS 900 million in assets. Two years later, the investment house manages NIS 7.5 billion in provident and mutual funds. In the face of this growth, Leader agreed to renegotiate the terms of the deal, to avoid having their partners feel “duped”.
Yelin and Lapidot will share the additional NIS 4.7 million equally. The money will be paid in five equal installments through September 2010. They will also receive salary raises as the managers of the investment house. In addition, the Buy-Me-Buy-You mechanism between the parties has been deferred by two years. Under the new agreement, the parties cannot exercise the mechanism before October 2010.
In effect, Yelin and Lapidot are receiving an additional 30% on their selling price for their company, even while its assets under management have increased eight-fold.
Published by Globes [online], Israel business news - www.globes.co.il - on September 5, 2007
© Copyright of Globes Publisher Itonut (1983) Ltd. 2007