the mother The Phoenix On the way to a fundamental change in the structure of control in society? The American funds Centerbridge and Glattin Point have started looking for investors who will buy part of the 33% that they hold in the insurance group with the largest value in Israel. As far as is known, the funds are looking to realize part of the investment they made in 2019 in light of the high return recorded by the stock. The Phoenix since.
Both funds acquired control about three years ago Fuel group Of Yitzhak Tshuva in the amount of NIS 1.7 billion. Today, the holdings of Centerbridge and Glattin Point are worth a little over NIS 3 billion, holdings that reflect a return of about 76%. In order to maintain the control permit, they must hold more than 30% of the company’s shares, so if they want to exercise part of the holding and still be part of the controlling interest, they will have to sell part of the shares to a buyer who will also need a control permit from the capital market commissioner.
The Centerbridge and Glattin Point funds said, “We are very pleased with our investment in Phoenix and will continue to be active shareholders. There is currently nothing new to report.” This means that the company does not intend to completely relinquish its holdings in Phoenix, and indeed they will have to add a partner and become part of the controlling nucleus.
The first insurance company to cross a market value of NIS 10 billion
The transaction for the purchase of 32.5% of the Phoenix shares was financed by the foreign funds that purchase through a loan from a banking-institutional consortium and through a seller’s loan provided by Delek Group. The main loan, amounting to NIS 575 million, was made through a consortium led by Mizrahi Tefahot, in which Menora Mivtachim and Meitav Dash also participated, with the collateral on the loan being the Phoenix shares sold. In addition, Delek provided the purchasers with a sale loan of NIS 200 million.
So far nothing real has happened, as noted in the two funds, but there is no doubt that realizing some of the investment is very worthwhile for them. The Phoenix is currently traded at a value of NIS 9.24 billion, and at its peak, before the declines in the capital markets, was the first insurance company to cross the NIS 10 billion mark.
This week, the insurance companies published their reports for the first quarter of 2022, which showed that the Phoenix recorded a total profit of NIS 352 million in the first quarter of 2022, reflecting a return on equity of 15.5%. This compares with a total profit of NIS 356 million in the corresponding quarter last year, a minimal decrease, with which the Phoenix also recorded the largest profit among the insurance companies.
Phoenix’s premiums and remuneration amounted to NIS 9 billion in the first quarter, an increase of 53% compared to the corresponding quarter last year. Most of the increase comes from management fees in the camel world, which grew from NIS 0.7 billion to NIS 1.4 billion.
The company’s underwriting profit grew by NIS 47 million to NIS 200 million, despite a loss of NIS 142 million in general insurance that comes mainly from a loss in car insurance as a result of the increase in the frequency of accidents and the increase in spare parts and the increase in car thefts. Compared with general insurance, health insurance contributed NIS 632 million due to the increase in interest rates, compared with a profit of NIS 32 million in the corresponding quarter last year.