US investment firm Searchlight Capital Partners and Israeli businessman David Fuhrer have officially taken over control of Bezeq Israeli Telecommunication Co. Ltd. (TASE: BEZQ), after completing the acquisition of control in Bezeq parent company B Communications Ltd. (Nasdaq:BCOM; TASE: BCOM). B Communications holds 26.34% of Bezeq, and is defined as its controlling shareholder.
Following completion of the deal, the new owners appointed two representatives to the Bezeq board of directors. Searchlight Capital Partners partner Darren Glatt was appointed on behalf of the firm, while David Fuhrer is represented by his son Ran Fuhrer.
B Communications is controlled by Internet Gold Golden Lines Ltd. (Nasdaq: IGLD; TASE:IGLD), which became insolvent in the past year and in effect sold control of B Communications in a debt settlement that included B Communications itself. B Communications CEO Ami Barlev and Internet Gold CEO Doron Turgeman vacated their places on the Bezeq board in favor of Glatt and Fuhrer.
Glatt will also be chairman of B Communications, with Barlev continuing as CEO.
Barlev said on completion of the deal, "This deal represents an opportunity to involve controlling shareholders of the first rank both for B Communications and for Bezeq, with experience and financial strength, representing significant capabilities and business and managerial added value for the group. Searchlight Capital Partners has proven, successful experience in global telecommunications investment, including upgrading of technologies and infrastructure with its direct involvement."
Searchlight and Fuhrer bought the controlling stake in B Communications (52%) from Internet Gold, and injected cash into B Communications in exchange for a further allocation of shares. Altogether, the buyers have invested NIS 630 million, following which Searchlight Capital Partners owns 60.12% of B Communications and Fuhrer 11.39%.
Also under the debt settlement, Internet Gold itself will use the amount it receives and its existing cash to inject NIS 345 million into B Communications against an allocation of shares and bonds, such that altogether NIS 640 million will be injected into B Communications. This amount together with B Communications' cash reserves allow the company to repay its entire debt to its Series B bondholders (NIS 240 million) and to make early repayment of NIS 614 million to its Series C bondholders.
Published by Globes, Israel business news - en.globes.co.il - on December 2, 2019
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