The deal between Bank Hapoalim and First International Bank is due to be completed this evening.
Sources inform "Globes" that Bank Hapoalim (LSE: BKHD; TASE: POLI) will complete the deal for the transfer of control of Bank Massad this evening. Bank Hapoalim sold 51% of Bank Massad to First International Bank of Israel (TASE: FTIN1;FTIN5) in October 2007 for NIS 236 million. Bank Hapoalim will record a NIS 57 million capital gain on the deal. If the closing is delayed beyond tomorrow, First International will have to add NIS 7.5 million to the price.
Bank Massad specializes in services to teachers. As part of the closing, an agreement was signed between First International and the Teachers' Union adopting the previous agreement with Bank Hapoalim, with certain adjustments. One of them is a four-year put option under which the union can sell 1% of the bank to First International. First International will issue a NIS 9.5 million capital note to Bank Massad to strengthen its capital structure in view of the grant that will be paid to its employees.
Published by Globes [online], Israel business news - www.globes.co.il - on May 14, 2008
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