Rami Levy, the Jerusalem businessman who started out with a modest grocery store in Mahane Yehuda and has built a supermarket empire, is literally reaching for the skies. His NIS 75 million bid together with fellow businessman Shalom Haim, through BGI Investments (1961) Ltd. (TASE: BGI), to buy Israir Airlines and Tourism Ltd. has been chosen by the IDB Development trustee Adv. Ophir Naor who has asked the court to approve the deal. His rivals may yet improve their positions and outbid him, but over the past year Levy has made it clear that his business appetite goes well beyond inexpensive food and household goods, and the real estate housing his supermarkets.
In recent months he has bid as a junior partner with businessman Tzahi Nahmias's Mega Or real estate company to buy Discount Investment Corporation (TASE: DISI). Market sources believe that he will put between NIS 55 million and NIS 220 million for a 5%-20% stake in Discount Investment.
Levy's name was also linked with a joint bid with Avi Levy's L.R. Lahav for the Delek Israel chain of gas stations and convenience stores. The bid failed probably because the amount offered fell short but there were also unsubstantiated rumors that Levy did not want to be associated with a business that opens on Shabbat (Friday night - Saturday). If the Israir deal goes through, we will likely find out the accuracy of such speculation.
Rami Levy has also been linked as a potential bidder for the 20% stake in the Israel Postal Co., which is being privatized. In this bid he is reportedly teaming up with Katz Deliveries and Logistics.
On top of all this and the core business Rami Levy Chain Stores Hashikma Marketing 2006 Ltd. (TASE:RMLI), Rami Levy has major operations in the real estate sector through a private company, which he has recently been considering floating on the Tel Aviv Stock Exchange. The real estate company, which focuses on income producing property, is valued at NIS 3 billion.
All these indications that Levy is eager to extend his business empire beyond retail supermarkets reflect how much ready capital he has available for such deals. 2021 looks like it could be a year of big opportunities for Levy, and in part it is due to the Covid-19 crisis, because while the pandemic knocked out many retail businesses, the supermarket sector has flourished, with sales of food and household goods rising, especially during lockdown and the extended closures of restaurants and cafes (although some of his supermarket rivals have taken better advantage of the shift to online supermarket sales).
In the past Levy has also hesitated to stray beyond retail and real estate such as with his mobile phone venture, and cheap television enterprise. But those used his supermarket chain customer base and did not require large amounts of investment capital to launch.
Even with Delek Israel and its convenience store chain there would have been synergy with his supermarket operations had the deal gone ahead. But Discount Investment and Israir have no obvious synergy and demonstrate the broadening of Levy's business appetite.
Published by Globes, Israel business news - en.globes.co.il - on December 3, 2020
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