Although Shaul Elovitch has not yet officially sewn up the financing for his acquisition of 30.6% of Bezeq The Israeli Telecommunication Co. Ltd. (TASE: BEZQ), Bank Hapoalim (TASE: POLI) will apparently head the syndicate that will finance the NIS 6.5 billion deal. Several months will likely pass between the signing of the sale contract and the closing of the deal.
JP Morgan Chase Inc. (NYSE: JPM) advised Elovitch's Eurocom Group unit 012 Smile.Communications Ltd. (Nasdaq:SMLC; TASE: SMLC) on the deal.
Bank Hapoalim, under president and CEO Zion Kenan, should have no problem financing the deal on its own. However, it will probably prefer preparing a syndicate to spread the risk, by bringing two smaller banks and possibly a foreign bank as well. Bank Hapoalim declined to comment on the matter.
International calls carrier and Internet services provider Smile will reportedly put up NIS 2.5 billion in equity for the deal, some of which it will raise by selling cross holdings. NIS 2-3 billion will come from a bank loan, and the rest from non-bank sources, by a bond offering of NIS 1.5-2 billion. Elovitch may also bring in a partner into the controlling core of Bezeq.
Smile's share closed at $10.51 on Nasdaq on Friday, giving a market cap of $266 million. The share rose 24.3% by mid-afternoon on the TASE to NIS 48.48.
Published by Globes [online], Israel business news - www.globes-online.com - on October 25, 2009
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