After resigning from Cellcom: Gabay’s new move

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The Hutchison Group, the current controlling shareholder of Partner, accepted the offer of the group led by retiring Cellcom CEO Avi Gabay and businessman Shlomo Rodev.






Avi Gabay, Archive | Photo: Gili Yaari, Flash 90, News

The deal to sell Hutchison shares in Partner to Avi Gabay and Shlomo Rodev’s group was approved, after the group submitted an official offer to purchase the shares last night (Tuesday).

Now the ball goes to the court. The trustee’s response to the shares on behalf of the court will probably be positive, after Hutchison’s approval. This is expected to happen by the end of the week or at most until the beginning of next week.

The Gabay-Rodev Group offered to purchase the shares (27.1%) for about $ 300 million, and it does so without due diligence, which greatly helped Hutchison to respond positively to the offer.

In addition, the local group is not expected to have problems approving the deal, so for the seller it is a very big advantage that eliminates uncertainty about its realization, which was not guaranteed at all in case there was a sale to the Apollo Investment Fund which also negotiated the shares.

The negotiations were conducted by Shlomo Rodev, when Avi Gabay, who is a partner with him in the management group, distanced himself against the background His departure from the position of CEO of Cellcom in the beginning of the week.

Rodev has been negotiating in recent months in a number of rounds. At first he thought he could get financing from Hutchison through a shareholder loan, and after she refused, he began to consolidate investors, until the negotiations matured into a final bid yesterday.

Market estimates are that it is possible to increase the average income from a cellular subscription by NIS 5-10 per month, and that this will contribute to EBITDA on the order of hundreds of millions of shekels per year, which will allow the company to sell at a large profit within a few years. The question is whether prices can be raised and how it will happen, and what to do with other non-profit activities like TV and investing in fiber.

The article was first published in Globes.

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