Capital Market, Insurance, and Savings Authority commissioner Dr. Moshe Bareket is dissatisfied with the way insurance and financial groups Menorah Mivtachim Holdings Ltd. (TASE: MORA) and The Phoenix Holdings Ltd. (TASE: PHOE1;PHOE5) joined real estate company Gazit-Globe in the deal to acquire the public's shares in Gazit-Globe Ltd. (TASE: GZT; TSX: GZT) subsidiary Atrium, which operates in Central and Eastern Europe. Bareket contacted the two investment institutions and demanded details about their decision-making process in preparation for a possible unprecedented intervention in the deal in order to alter its terms, sources inform "Globes."
The Capital Market, Insurance, and Savings Authority did not respond to the report. Menorah Mivtachim said, "The deal is a large one with a high potential return for the group's members and policyholders. The deal was thoroughly examined and checked, and was approved by all of the parties and committees in the company."
Last July, Gazit-Globe, controlled and managed by Chaim Katzman, announced that it had contracted an agreement to acquire 40% of the shares in its Atrium subsidiary, the public's entire holding in the company, and would make Atrium a private company. At the same time, Gazit-Globe announced an agreement with Menorah Mivtachim under which it would sell 12% of Atrium's share capital for €150 million, the same price at which it was acquiring the shares, to Menorah Mivtachim after Gazit-Globe acquires full ownership of Atrium. Phoenix joined the deal several weeks later by signing an agreement to buy 6% of Atrium's share capital for €75 million at the same price.
In both announcements to the Tel Aviv Stock Exchange, Gazit-Globe stated that Menorah Mivtachim and Phoenix had been given the customer the usual rights awarding them protection as minority shareholders in Atrium. Furthermore, the participation of investment institutions in the deal to acquire control of a private company as minority shareholders is not a rare occurrence. Only recently, several investment institutions, including Menorah Mivtachim joined foreign fund Warburg Pincus in the deal for acquiring credit card company Leumi Card, which has since changed its name to Max.
Published by Globes, Israel business news - en.globes.co.il - on September 15, 2019
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