Knafaim Holdings Ltd. (TASE: KNFM) CEO Israel (Izzy) Borovich has decided to end his business involvement in the company. In a notice to the TASE today, the company stated that controlling shareholder David Borovich had informed that he had received from his brother, Israel Borovich, an option to buy his 16.8% stake in the firm at a company value of $145 million. Israel Borovich is also chairman of El Al Israel Airlines Ltd. (TASE: ELAL), which is controlled by Knafaim.
The option is valid through May 28, and if the option is exercised, the sale will be completed by the end of July. Knafaim said that Israel Borovich said that he would keep his posts at both Knafaim and El Al until the deal is closed, at which point he will resign.
Israel Borovich told "Globes", "If I'm going to sell, I'll sell to him. Knafaim is now going to strengthen its leasing business, which is David's specialty, so it's natural that I'll give him the option to do this."
Ever since Knafaim acquired control of El Al following its privatization, investors had expressed interest in buying shares in Knafaim, but no serious offers were actually made. Israel Borovich said that, even if there were other buyers for his shares, he must first offer them to his twin brother. "We've been together 67 years. He began the business and invited me to join him, so the best thing for Knafaim is for David to buy the shares. There's no doubt that this will cause the least shock to the company."
Published by Globes [online], Israel business news - www.globes-online.com - on April 8, 2008
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