Investment fund FIMI Opportunity Funds (FIMI), led by Ishay Davidi, recently bought the top (40th) floor in the Alon Towers 2 in Tel Aviv from the Ha'argaz Group, controlled by Maj. Gen. (res.) Haggai Shalom, for NIS 21 million, sources inform "Globes." The floor contains 1,100 square meters. The price in the deal was NIS 19,000 per square meter in shell condition. With the addition of the 15 parking spaces that FIMI will receive, the cost of the purchase will be at least NIS 25 million.
As of now, FIMI, Israel's leading and most successful private equity fund, rents 800 square meters on the 40th floor of the Electra tower near the Alon Towers to which FIMI will move. 30 people will work in the new offices to which FIMI is expected to move in early 2019. Market sources said that the size of the offices purchased was adapted to growth in FIMI's activity and that of its portfolio companies.
The Alon Towers project consists of two 40-storey office towers on Yigal Allon Street in Tel Aviv overlooking the Ayalon Highway near the Hashalom railway station. The project was developed by BSR Europe (TASE: BSR), controlled by Nachshon Kivity, which exercised an option in 2011 to buy the 20-dunam (five-acre) site on which the Ha'argaz plant formerly operated. BSR Europe paid NIS 240 million for the land in a deal in which the seller retained the 40th floor now being sold.
For Shalom, the exit is remarkable; he acquired Ha'argaz in 2000, 10 years before the land was sold, for only a few million shekels. Shalom acquired Ha'argaz, which was owned by the Histadrut (General Federation of Labor in Israel), with the help of Yitzhak Tshuva. "The banks told me I had to invest NIS 100 million, and I didn't have a dime. Tshuva, who previously offered me the job of chairperson at Delek Group, provided a NIS 50 million guarantee and the banks loaned NIS 50 million more," Shalom related several year ago.
Shalom, incidentally, went on to make another successful deal by acquiring the Tiv Taam (TASE: TTAM) supermarket chain, which had gotten into trouble, and restoring it to prosperity. The chain's current market cap is over NIS 260 million.
FIMI, founded in 1996, is Israel's first and largest private equity fund, with $5 billion in managed assets. The fund acquires control of companies and upgrades them. As of now, the company has acquired 87 companies and sold 57 of them in deals for an aggregate $4.5 billion. Companies in which FIMI currently has investments have a total of over 27,000 employees. The firm has invested in a broad range of sectors to date, including most industrial, commercial, and services sectors. FIMI does not invest in real estate or financial companies.
Published by Globes [online], Israel business news - www.globes-online.com - on July 9, 2018
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