Discount Investment Corporation yesterday signed an agreement to sell it 94% stake in the Albar Mimunit Services leasing company to entrepreneur Eli Elezra for $55 million. Discount Investment will post a NIS 40 million capital gain on the sale.
The IDB group has been trying to sell Albar for several months as part of its efforts to sell holdings outside its core business. The sale will release large credit resources for Discount Investment, since Albar's bank debt at the end of 2001 was NIS 1.25 billion.
Albar is Israel's largest leasing company. The sale price was substantially higher than that of New Kopel, the second largest, which has a $20 million market value. As far as is known, Bank Leumi is providing most of the financing for Elezra's acquisition.
In the previous decade, Elezra managed the Ashkelon Economic Development Corporation. In February 2001, Elezra won a Government Companies Authority tender for buying Afridar Building and Investment for NIS 80 million.
Albar has a 46,000 vehicle lease fleet with a value of NIS 1.2 billion. Company revenue totaled NIS 637 million last year, but its profit was only NIS 1 million.
Elezra told "Globes" he planned to add two more business divisions to Albar: one for commercial banking, which will be called Albar Israel Finance Bank, and an insurance company. He does not plan to enter auto imports in competition with the current importers. All banking and insurance activity requires lengthy registration proceedings.
Elezra added that he is undertaking the acquisition independently, without the participation of leading businessmen, such as Moti Zisser and Yuli Ofer, with whom he cooperates in real estate.
Published by Israel's Business Arena on May 1, 2002