Discount Investment Corporation (TASE: DISI), a holding company under Nochi Dankner-controlled IDB Holding Corp. Ltd. (TASE:IDBH), will acquire more than 50% of Ma'ariv Holdings Ltd. (TASE: MARV-M) for NIS 140 million.
Discount Investment said that it had been approached by Ma'ariv's main shareholders, and the deal is near completion. The company publishes Hebrew daily "Ma'ariv". Discount Investment will inject NIS 120 million into Ma'ariv, of which NIS 20 million will be injected immediately, and will acquire part of the stake of Ma'ariv chairman Zaki Rakib in the company.
While the holding structure is not yet known, Dankner will be the controlling shareholder. It is not impossible that the ultimate goal is complete control of the Ma'ariv group.
The feeling is that acquiring Ma'ariv is just the first move into media, and joins other Dankner holdings in the telecommunications industry - Cellcom Israel Ltd. (NYSE:CEL; TASE:CEL) and NetVision Ltd. (TASE: NTSN). The acquisition is part of an overall view that regulatory changes will lead to Dankner's holdings facing other groups such as Bezeq The Israeli Telecommunication Co. Ltd. (TASE: BEZQ) and Hot Cable Systems Media Ltd. (TASE: HOT).
It appears that Dankner feels the Achilles' heel of his group is content, and the investment in Ma'ariv is likely a first, cheap move in a string of acquisitions which will allow it to create an alternative source of content, based on a veteran and well known brand.
According to estimates in the communications industry, it is possible that the next step will be buying holdings in commercial television, with Channel 10 being mentioned as a possibility.
One of Dankner's motives was the understanding that were he not to get involved now, the newspaper would collapse, apparently as soon as within days, as Rakib apparently did not intend to cover the company’s debt to Bank Hapoalim (TASE: POLI).
Ma'ariv Holdings' other main shareholder is Ofer Nimrodi, through Israel Land Development Company (TASE: ILDC).
Dankner is one of the leading businessmen whom Rakib was in talks in the past few days. Adv. Ram Caspi handled the negotiations.
Dankner, whose fortune has been estimated at $1 billion, has never before owned a holding in a media company, in contrast to other Israeli tycoons, such as Yitzhak Tshuva, the Ofer family, and Yosef Maiman, all of whom own stakes television station franchises.
Ma'ariv's share price is unchanged at NIS 3.46, giving a market cap of NIS 124 million.
Published by Globes [online], Israel business news - www.globes-online.com - on March 23, 2011
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