Less than a month has gone by since the cancellation of the planned deal whereby control of insurance and finance group The Phoenix Holdings (TASE: PHOE) to Abu Dhabi-based wealth fund ADQ, and now The Phoenix has reported a deal in which "an investor from the UAE" bought shares in the company to the tune of NIS 184 million. At the time that it reported the cancellation of the deal with ADQ in late July, The Phoenix also reported that the foreign funds that control it - Centerbridge and Gallatin - would retain a holding of at least 30%, fully diluted.
The share price in current deal is the same as in the non-binding MOU signed with ADQ in December. i.e., NIS 36.27, giving a small discount on the market price, which closed at NIS 37.21 yesterday. The Phoenix has a market cap of NIS 9.5 billion. The funds that control the company, which held 32.8% of the shares, sold 2% of the company to the UAE investor.
ADQ was to have bought a 25% stake in The Phoenix at a valuation of NIS 9.2 billion. The deal became controversial, given the prospect of a fund controlled by the UAE would control Israel’s largest insurance group and the NIS 400 billion savings that it has under management.
The Phoenix said that the deal was cancelled by mutual consent because of likely regulatory difficulties.
The cancellation prevented the US funds that control The Phoenix from making an impressive exit, with a NIS 1.4 billion return on their investment, including the hundreds of millions of shekels they had received in dividends over the years. Centerbridge and Gallatin will now have to wait for another buyer to come along.
Published by Globes, Israel business news - en.globes.co.il - on August 16, 2023.
© Copyright of Globes Publisher Itonut (1983) Ltd., 2023.