Delek Group Ltd. (TASE: DLEKG), controlled by Yitzhak Tshuva, today announced that it had sold 4.9% of the shares in The Phoenix Holdings Ltd. (TASE: PHOE1;PHOE5) for NIS 253 million at yesterday's closing share price on the TASE. As of now, the identity of the buyer is unknown.
At the same time, Delek Group made a swap deal with Mizrahi Tefahot Bank (TASE:MZTF). Under this deal, Delek Group will settle accounts with the banks concerning the dividend-adjusted value of Phoenix two years from now. If Phoenix's share price rises, Delek will receive additional proceeds, while if the insurance group's value declines, Delek Group will make a payment to Mizrahi Tefahot.
Delek Group sale of shares comes less than a year after it received NIS 208 million from the sale of the same number of Phoenix shares to Chinese-American company Sirius. Delek Group is trying to sell Phoenix as part of its strategy of focusing on energy business and in order to comply with the Promotion of Competition and Reduction of Concentration Law.
The Capital Market Authority recently approved a reduction in the minimum control core in Phoenix from 40% to 30% of the share capital, the requirement for medium-sized companies. At the same time, even after the current deal, Delek Group still holds a 41.3% stake - more than the minimum controlling core in Phoenix. Delek Group can therefore sell 11% more of Phoenix's shares and still find a strategic buyer for control of the insurance group.
Published by Globes [online], Israel business news - www.globes-online.com - on August 30, 2018
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