Israel Postal Co privatization to be restarted

Israel Post Office

The first stage will be a sale by auction of 20% of the company to a private investor.

The effort to privatize The Israel Postal Company is to be renewed, following a request from the company to the Government Companies Authority, which acceded to it.

The privatization of the postal service was halted because of Israel's repeated elections and the delay in forming a new government. Now, The Israel Postal Company seeks to get the process moving again. Initially, 20% of the company will be offered to an external investor.

The privatization of The Israel Postal Company has already received all the necessary approvals from the Government Companies Authority and the government. It is therefore not necessary to start the process from the beginning, but only to publish a tender and request bids from private investors for 20% of the shares.

Privatization at this time, at the height of an economic crisis and with great uncertainty on the financial markets, certainly carries risks.

Investors who express interest in the company will have to deal with the postal service's main problem, which is the obligation to provide universal service, an obligation that imposes heavy costs, amounting to NIS 60-70 million annually.

The ministerial privatization committee decided on the privatization of The Israel Postal Company in July 2018. It was decided to sell 40% of the shares in the company in two stages: first, an sale of 20% of the state's shares to a private investor, followed by an offering on the Tel Aviv Stock Exchange. In any event, under the proposal, the state will not go below a 60% holding in the company.

Published by Globes, Israel business news - en.globes.co.il - on May 17, 2020

© Copyright of Globes Publisher Itonut (1983) Ltd. 2020

Israel Post Office
Israel Post Office
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