Israeli officials are going to China to move forward on the sale of Clal Insurance Enterprises Holdings Ltd. (TASE: CLIS) and Tnuva Food Industries Ltd. to Chinese companies.
Apax Partners Israel CEO Zehavit Cohen is already in China with lawyers and accountants to move forward on the sale of the controlling interest in Tnuva to Bright Food Group. Sources inform ''Globes'' that officials from the Capital Markets, Insurance, and Savings Division will depart in a few days to work on the process for a control permit for the consortium headed by JT Capital Fund pte Ltd. so it can acquire Clal Insurance from IDB Holding Corp. Ltd. (TASE:IDBH).
The sale of Tnuva is the larger of the two transactions. A knowledgeable source said that Cohen and her team are in China to try and close the deal within days. The parties are talking about a sale at a company value of NIS 8.5-9 billion for Tnuva.
Since there is no assurance that a deal will be reached, Tnuva is still pursuing plans for an IPO on the Tel Aviv Stock Exchange (TASE) in May, as an alternative exit for Apax, if necessary. Bright Food will reportedly appoint its own chairman for Tnuva if it acquires the company.
Apax owns 56% of Tnuva. Mivtach Shamir Holdings Ltd. (TASE:MISH) is its partner in the controlling core of the company, which they jointly acquired at a value of NIS 3.8 billion in early 2008. They subsequently reaped huge dividends from Tnuva.
JT Capital is due to acquire control of Clal Insurance for NIS 1.5 billion, giving a company value of NIS 4.6 billion, under an agreement signed in August 2013. The sale has since been waiting for a control permit from the Capital Markets, Insurance, and Savings Division, which is examining the buyers, and has reportedly sent two officials to China for this purpose.
Although the Capital Markets, Insurance, and Savings Division has reportedly given "approval in principle" for the deal, JT Capital still has one more obstacle to navigate. The agreement set a deadline of May 1 to close the deal, subject to JT Capital obtaining a control permit. In view of the delay in obtaining it, earlier this month, JT Capital asked IDB to extend the deadline until May 31.
Published by Globes [online], Israel business news - www.globes-online.com - on April 24, 2014
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