Kardan mulls selling AVIS Israel stake

Vehicle importer UMI would pay Kardan in either cash or shares for the rental and leasing company.

A huge merger is on the horizon in the vehicle sector. As first reported by "Globes" Kardan Israel Ltd. (TASE: KRIS) is investigating the possibility of selling to the holding company of the Eini family, which owns General Motors importer Union Motors Israel (UMI), the balance of its holdings in Kardan Vehicle Ltd. (TASE: KVCL), which operates leasing and rental company AVIS Israel.

Kardan currently holds a 37.5% stake in Kardan Vehicle and UMI parent company Mizrahi holds a similar stake with the remaining shares held by the public. The deal, which would be worth hundreds of millions of shekels, would be made through a cash payment or UMI shares. If Kardan decides to opt for UMI shares then it would hold a 50% stake although sources in the vehicle sector believe Kardan would "rather have cash."

At the same time UMI said that in the future it would consider buying Kardan Vehicle shares from the public and delisting the company.

The deal is subject to approval by the Israel Antitrust Authority.

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