Bezeq Israeli Telecommunication Co. Ltd. (TASE: BEZQ) released an update this morning on the write-down expected of the value of its satellite broadcasting subsidiary Yes if the Israel Securities Authority (ISA) does not allow it to turn subsidiaries Pelephone, Bezeq International and Yes into a single accounting unit.
According to Bezeq's latest notice, the write down of assets in the accounts of subsidiary company DBS Satellite Services (trading under the Yes brand), which market estimates had put in the millions of shekels, will ultimately total NIS 1.1 billion.
As "Globes" revealed yesterday, the Yes board of directors met yesterday to discuss the matter, in tense anticipation of the ISA's decision, which is expected within the next few days.
In the deal in which Bezeq bought Eurocom's stake in Yes, the broadcaster was valued at NIS 2.1 billion. Since then, a series of write-downs have brought its value to NIS 1.35 billion. The new write-down will therefore almost wipe out its value.
Two months ago, Bezeq reported an expected diminution in the fair value of its subsidiaries, particularly Yes. Today, a week before it is due to publish its 2018 financials, Bezeq has reported the extent of the expected write-down.
As mentioned, Bezeq is still waiting for a decision by the ISA on whether it can treat the subsidiaries as a single accounting unit. If it received approval to do so, the write-down it will post will be immaterial. If approval is not forthcoming, Bezeq will make a write-down in its financials of NIS 1.5 billion in the book value of Yes, and its profit and shareholders' equity will fall accordingly.
Published by Globes, Israel business news - en.globes.co.il - on March 19, 2019
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