The sale of the 82% controlling stake in Discount Investment is underway. Yesterday evening, the Ministry of Communications approved the sale of the shares by the administrator of IDB Development to the investor consortium led by real estate company Mega Or Holdings Ltd. (TASE: MGOR), which is controlled by Zahi Nahmias. The ministry’s approval was required because of Discount Investment’s holding in telecommunications company Cellcom Israel Ltd. (NYSE:CEL; TASE:CEL).
Today the deal was approved by the Israel Competition Authority on condition that Mega Or sells its holdings in the ISPRO centers in Modiin and Kiryat Gat.
The consortium is expected to include Rami Levy, who seeks to buy 10% of Discount Investment, and Chen Lamdan, who controls logistics company Orian (TASE: ORIN).
Mega Or is due to complete the deal within five days of receiving the Ministry of Communications’ approval. Earlier yesterday, the Tel Aviv District Court approved the amendment to the sale agreement requested by Mega Or whereby the purchase of the shares will be in two stages, in order to enable Elco Holdings Ltd. (TASE: ELCO) to join the consortium. Elco needs time in which to obtain regulatory approvals.
Last November, Mega Or undertook to lead a consortium of investors to buy from the administrator of IDB Development the company’s 82% holding in Discount Investment for NIS 1.1145 billion. Now, the Mega Or consortium will initially buy 47-60% of Discount Investment for NIS 637-813 million, payable within five days. The sale of the remainder of the shares being bought will be completed within 90 days by Elco or other investors. Mega Or will pay 5.25% annual interest on the balance for period between the two stages, and will be liable to pay compensation of NIS 100 million to the IDB Development bondholders if the full consideration is not paid on time in the second stage. This is in addition to the guarantees already given.
Published by Globes, Israel business news – en.globes.co.il – on March 16, 2021
© Copyright of Globes Publisher Itonut (1983) Ltd. 2021