Bronfman Group Sells Off Final Discount Bank Stake

The Bronfman Group has sold off its final holdings in Israel Discount Bank (TASE: DSCT). Sources inform “Globes” that last night the remaining 4.5% stake in the bank held by Matthew Bronfman worth about $80 million was distributed by Citi. Market sources believe that more than half the buyers were foreign investors.

The shares were distributed at a price of NIS 6.12 per share, a 2.8% discount on last night’s closing price on the Tel Aviv Stock Exchange (TASE). Such an investment by overseas investors is encouraging and no small matter at a time when many foreign investors are being scared away from the TASE because of the political uncertainty.

This is the final distribution of shares, which began more than a year ago, in the dissolution of the controlling core in the bank. Over the past year the Bronfman-Schron Group has sold off its controlling core, putting the bank’s share under pressure and resulting in an 11% decline. The Schron Group has already sold off its entire 5% stake in Israel Discount Bank.

In September, the Bronfman Group had seemingly completed its sell off when its stake fell below 5%, as required by the Bank of Israel, as part of the dissolution of the controlling core. But it now transpires that the Bronfman Group even has no interest in holding onto a small stake even as a financial investment. The latest distribution was at a higher price than some of the recent selloffs because of the rise in the share price.

Israel Discount Bank is 100% owned by the public. Earlier this week, giant investment company Wellington Investment Group bought a 2.7% stake in Israel Discount Bank for its customers, suggesting that it sees an upside that the Bronfman Group does not.

Published by Globes [online], Israel business news – www.globes-online.com