A week has gone by since Delek Group Ltd. (TASE: DLEKG) gave notification of the breakdown of the deal whereby insurance group The Phoenix Holdings Ltd. (TASE: PHOE1;PHOE5) was to have been sold to the Kushner family of the US, and "Globes" has now learned that the two sides are back in talks on a new format for a smaller deal. Market sources estimated today that Delek Group controlling shareholder Yitzhak Tshuva was still demanding a price that would reflect the insurance group's shareholders' equity, but that he was prepared to reduce the scope of the deal, and thereby make it easier for the Kushner family to make the acquisition.
In the aftermath of the breakdown of the original deal, the Kushner family stated that it was withdrawing its application to the Director of Capital Markets, Insurance and Savings at the Ministry of Finance, but as far as is known the application has not so far been withdrawn.
Under a memorandum of understanding signed in July of this year, the Kushner family was to have paid Delek Group NIS 1.7 billion for the 47% controlling stake in Phoenix. Delek Group needs to sell its stake in Phoenix because of the Economic Concentration Law, which forbids the simultaneous holding of substantial financial and non-financial corporations. The planned sale is also consistent with Delek Group's aggressive moves over the past year to sell holdings that are not part of its core energy business.
Published by Globes [online], Israel business news - www.globes-online.com - on December 22, 2014
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