The "Financial Times" reports that Delek Group Ltd. (TASE: DLEKG) subsidiary Delek Capital Ltd. is interested in UK investment bank Collins Stewart plc (LSE: CLST). The paper quotes a company insider as saying that the two companies have had “very initial, preliminary discussions” weeks ago - although no advances have been made since.
It is clear that Delek Group controlling shareholder Yitzhak Tshuva is eying Collins Stewart and possibly other troubled investment houses. Collins Stewart is considered the UK's leading broker for small and mid-sized companies. Founded 17 years ago, it has grown in part through mergers and acquisitions, including the acquisition of US investment bank Unterberg Towbin. Unterberg Towbin's Israeli office became the local office of Collins Stewart.
Delek Capital is apparently on a buying spree. Early this year, it acquired US insurer Republic Companies Group Inc. for $290 million. A month later it bought 20% of an Indian financial services company for $25 million, but cancelled the deal a few weeks later.
According to the "Financial Times", Delek Capital is not the only company interested in Collins Stewart. Australian financial services group Macquarie Group Ltd. (ASX: MQG) and Iceland’s Straumur Investment Bank (OMX: STRB) are candidates, but the paper says that the most logical candidate is Japanese investment bank Nomura Holdings Inc. (TSE: 8604; NYSE: NMR). British daily "Independent" also mentions Indian financial services company JM Financial Ltd. (BSE: 523405).
Since Collins Stewart announced that it had received an acquisition offer at an undisclosed amount on Wednesday, its share has shot up 38%, recovering most of its 39% drop since January.
Published by Globes [online], Israel business news - www.globes-online.com - on August 10, 2008
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