The surprising deal of the past year in the insurance industry was launched tonight (Thursday), when the commissioner of the capital market, Dr. Moshe Barkat, gave the digital insurance company and alignment a control permit in the old insurance company Ayalon.
Vishor needed a control permit to purchase 67% of Ayalon for a sum of NIS 463 million. In order to raise the money, they included Caesarea Medical Electronics, which is controlled by businessman Zvi Barak and his wife Anat. According to the initial agreement between the parties, the Barak couple was supposed to invest NIS 180 million in Ayalon and NIS 90 million in alignment, but it was finally agreed, as part of the preparation for the acquisition of control of Ayalon, that he would invest all NIS 270 million in alignment. The digital insurance company.
However, the financial issue was not the only or even the main obstacle that stood in the way of Vishor acquiring control of Ayalon. During the process of obtaining the control permit, the Securities Authority, even though it is not the regulator approving the transaction, raised the need to fold one of the strata in Ayalon. H), and in the current alignment and Ayalon structure a three-layer pyramid will be formed. When the top was supposed to be Vishor (public), below it Ayalon (public) holding company and later Ayalon Insurance (private, is not considered a stratum under the law of centralization as a stratum) and Ayalon IPOs (raising company).
In order to deal with the ban, in early March, the boards of directors of Ayalon Holdings (parent company) and Ayalon Insurance (subsidiary) approved a merger between the two companies that allows for a layer fold (insurance companies are excluded from raising bonds) and removed the obstacle to completing the transaction. The Commissioner of the Capital Market insures an insurer license for the merged company Ayalon Insurance Company and initiated the move almost definitively.
After the removal of the regulatory barrier, Barkat granted a control permit to the controlling owners of Vishor Emil Weinschel and Nitzan Tze’ir-Harim, together with Zvi and Anat Barak, which allows them to hold, directly or indirectly, Vishor GlobalTech (Vishor’s public company) and the insurance companies controlled by: Vishor Insurance Company and Ayalon insurance company. In accordance with the Commissioner’s requirement, the control permit also includes an appendix to the control group’s and the company’s commitment to perform actions related to the existing owner loan in Ayalon Insurance in the amount of NIS 55 million included in the sale agreement of Ayalon shares to the company. It should be noted that the approval from the Capital Market Authority was given after the Competition Authority approved the transaction between Vishor and Caesarea on Monday this week.
As stated, as part of the transaction, Caesarea Medical Electronics undertook to inject NIS 270 million into alignment. Now, with the approval of the Capital Market Authority, Caesarea this evening transferred a first payment of NIS 100 million for alignment.
A report by Vishor to the stock exchange states that the other terms of the agreement between all those involved – Vishor-Caesarea-Ayalon have remained as they are. This means that as published this week in Globes, all payments in the transaction will be paid in accordance with the agreed prices, although the share prices of both Vishor and Ayalon have plunged since those agreements were signed.
Thus, at the time of signing the agreement, last September, it was agreed that the price of the Vishor share to be sold to Caesarea would be 6.3 and would reflect a premium of approximately 20% on the market price. Today it is a premium of 125%, with the share value standing at only NIS 2.8. During this time, the Ayalon share also suffered a blow and the gaps between the price agreed that Vishur will pay for its control and the price today swelled. In alignment, they undertook to purchase the shares at a price of NIS 38.6 per share, which then constituted a premium of 33% over the market price and today already constitute a premium of 68%.