Swarth Group, an investment vehicle controlled by Shaul Shani, and certain funds that have appointed Ashmore Investment Management Ltd. (LSE:ASHM) have completed their takeover of telecommunications equipment maker ECI Telecom Ltd. at a company value of $1.24 billion. Following the deal, ECI has been delisted from Nasdaq.
ECI reported that 99% of the company’s shareholders approved the merger at an extraordinary general meeting held on August 29, 2007. Each shareholder automatically received $10 per share. ECI closed at $9.96 at its final closing on Thursday, after the share climbed steadily following the announcement of its takeover.
ECI president and CEO Rafi Maor said, "Today's announcement concludes the process we announced earlier this summer. ECI is embarking on a new road as a private company after 25 years on Nasdaq…I would also like to take this opportunity to thank again ECI's dedicated and professional employees worldwide. This transaction is a testament to their devotion, talent and hard work."
Shaul Shani has been appointed chairman of ECI, replacing Shlomo Dovrat.
In the transaction, Koor Industries Ltd. (TASE:KOR) sold its 28% stake in ECI for $330 million and will report a capital gain of about NIS 495 million on the sale in its financial report for the third quarter. Clal Industries and Investments Ltd. (TASE: CII) sold its 12.6% stake for $152 million. Clal Industries also owns a stake in Koor. Clal Industries’ parent company IDB Development Corp. Ltd. (TASE: IDBD) will report a capital gain of NIS 90 million, but its sister company, Discount Investment Corporation (TASE: DISI), which also a stake in Koor, will report a loss of NIS 69 million. The parent group IDB Holding Corp. Ltd. (TASE:IDBH) is controlled by chairman and CEO Nochi Dankner.
Published by Globes [online], Israel business news - www.globes.co.il - on September 30, 2007
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