IDB examining ways of selling Clal Insurance

The group is considering various possibilities for selling its stake in Clal Insurance in whole or in part.

 (R-L) Eduardo Elsztain and Moti Ben-Moshe


The IDB group is examining various possibilities for the sale of control or of smaller stakes in Clal Insurance Enterprises Holdings Ltd. (TASE: CLIS). This follows the assessment by Dorit Salinger, Director of Capital Market, Insurance and Savings at the Ministry of Finance, that it would be difficult to grant a permit for IDB controlling shareholders Moti Ben-Moshe and Eduardo Elsztain to control Clal Insurance.

Elsztain and Ben-Moshe are examining ways of strengthening IDB Development’s capital structure and reducing its debt, and renewing the application for a permit on this basis.

At the same time, the two men are also examining the possibility of selling IDB’s stake in Clal Insurance in stages over a period of time to be set by the regulator, which would facilitate obtaining the maximum consideration under the circumstances, “including the possibility of a full or partial sale to one or both of the controlling shareholders in a controlling group together with the company or a separate controlling group, and on that basis to revise the application for a permit.”

Ohad Aloni, of the Association for the Protection of the Public’s Savings, which represents about 10% of the minority shareholders, said, “This is a welcome move by the company’s management, indicating a mature attitude and a genuine attempt to reach a solution to the present situation. It will create a turning point for the company. We intend to work towards a change in the structure of the safety net, the strengthening of IDB’s shareholders’ equity to $435 million, for the purpose of obtaining a permit to control Clal Insurance. Alternatively, if we do not manage to do this, we intend to set up a special purpose corporation that will ensure that the enhancement of value will not be stolen from the public on the sale of Clal Insurance. The solution for Clal Insurance will be found only through cooperation with the Director of Capital Market, Insurance and Savings at the Ministry of Finance which so far has taken a responsible stance. The controlling shareholders will also have to show flexibility in order to meet the criteria.”

Published by Globes [online], Israel business news –

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