Kardan Israel Ltd. (TASE:KRIS) is acquiring direct control of Israel franchisee Dan Vehicle and Transportation Ltd. (TASE: DVT) and severing its ties with greater Tel Aviv bus operator Dan Company for Public Transport Ltd., in Emed, through which the two companies controlled Dan Vehicle.
Kardan Israel acquired the 54.25% controlling interest in Dan Vehicle for NIS 334 million, reflecting a company value of NIS 615 million. The deal will give Kardan Israel a 68% stake in Dan Vehicle.
As part of the deal, Kardan Israel is terminating its partnership with Dan Public Transport in Emed Real Estate Development & Investments Ltd., which owns the Dan Vehicle stake that Kardan is acquiring, and Kardan Israel will sell its 50% stake in Emed to Dan for NIS 359 million. The agreement includes a reciprocal waiver of claims by all parties.
Kardan Israel CEO Eitan Rechter will become chairman of Dan Vehicle. He said, "We believe in Avis's potential and in the ability of its management to continue to develop the company and lead it to success. We believe that the acquisition of the controlling interest in Avis Israel is a strategic investment for Kardan Israel."
Kardan NV (TASE: KRNV;AEX:KARD) owns 74% of Kardan Israel. Kardan Israel's share price rose 1.9% by early afternoon to NIS 9.08, giving a market cap of NIS 722 million. Dan Vehicle's share price rose 2.6% to NIS 35.50, giving a market cap of NIS 543 million.
Published by Globes [online], Israel business news - www.globes-online.com - on January 13, 2011
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