Like its predecessor, 2021 was a year marked by the fight against the corona plague. When it came to the local capital market, however, it was not the only struggle. The control struggles that took place in public companies were responsible for 85% of the acquisitions made by stakeholders, according to a survey published yesterday by the Tel Aviv Stock Exchange regarding the purchase and sale of shares by stakeholders.
Read more in Calcalist:
An interested party is one who holds 5% or more of the shares of a public company; A shareholder who is a member of the controlling interest in the company by virtue of a shareholders’ agreement; Or an officer in a company who also holds its shares.
3 View the gallery
Right: Mikey Zalkind Aaron Frenkel Daniel Zalkind
(Photo: Wikipedia, Israel Harari )
The TASE survey shows that stakeholders purchased shares for NIS 3.3 billion in the past year, 83% more than the acquisitions in 2020, which amounted to NIS 1.8 billion. Most of the acquisitions were made due to control struggles, the most prominent of which has already come to an end.
In the main arena: Aaron Frenkel in front of properties and a building in a fight over the sea
The main battle in this arena took place with the real estate company Gev-Yam at its center. During 2021, Frenkel purchased shares that accounted for 16.6% of the company for NIS 1 billion, which ultimately led him to a 37.2% holding in Gev-Yam and to become the leading buyer among stakeholders this year. Next in line was Properties and Building, which purchased shares that accounted for 14.7% of Gev-Yam with a total investment of NIS 943 million, thus reaching a holding of 44.5%.
The battle between the parties was decided last month, when an agreement was reached between them: Properties and a Building will acquire Frenkel’s holdings in Gev-Yam for a total consideration of NIS 3.1 billion. This created a huge profit for Frenkel of NIS 1.2 billion in just a year and a half from the moment he began collecting Gev-Yam shares. This was during the period when Eduardo Elstein was the controlling shareholder of DKS, and later lost it to the bondholders because he did not meet his obligations to them.
The acquisitions of Frenkel and of Properties and Building together amounted to NIS 2 billion. That is, two-thirds of all acquisitions made by stakeholders during 2021.
The third largest purchase is the one made by Alrov Real Estate controlled (78%) by Alfred Akirov. During 2021, Alrov purchased 10% of Clal Insurance shares for NIS 416 million, thus increasing its holding to 15%, after purchasing additional shares during 2020. This is a holding. The maximum allowed to Alrov according to the current permit it received from the Capital Market Authority.
3 View the gallery
Control battles – the cash axis of the Tel Aviv Stock Exchange
Unlike the fight at sea, the fight at all insurance was not decided. Alrov has applied for a control permit in Clal Insurance, with the aim of acquiring another 15% and increasing its holding to 30%, and this is currently being examined. Akirov and Clal Insurance’s management, which is now traded without a controlling interest, have a history of bad blood, mainly due to struggles surrounding Alrov’s subsidiary, Luka, which operates luxury hotels in Europe.
Blocka is a partner of Akirov’s son, Georgi Akirov (15%, which he received without consideration), but over the years Alrov alone bore the financial burden of the company established in 2007, totaling NIS 2.4 billion. In light of a change in regulation, at some point this requires approval as a stakeholder transaction on behalf of the minority shareholders. At the time, those minority shareholders were primarily Clal Insurance, which held 12.9% of Alrov, and it refused to grant that approval.
The market estimated that Alrov’s entry into Clal Insurance was revenge. Alfred Akirov’s name is also linked to an affair in which claims were made that private shareholders – including Akirov, Mori Arkin and Eyal Lapidot – tried to influence Clal Insurance chairman Danny Naveh in order to fire CEO Yoram Naveh. In the end, a report by retired judge Yoram Danziger ruled that there was no defect in their actions, but criticized them.
This battle ended when Clal Insurance sold its shares to Israel Canada, which is controlled by Barak Rosen and Assi Tochmeier, for NIS 382 million. But this move also gave rise to a new battle – shareholders submitted a request for disclosure of documents regarding this transaction, due to Akirov’s statement in an interview with Calcalist that he offered Clal Insurance a high offer of NIS 125 million for the shares. The plaintiff even asked the court to summon Akirov to testify. The hearing is set for April and by then Akirov may already have control of Clal Insurance.
3 View the gallery
Alfred Akirov
(Photo: Jonathan Bloom)
In addition to the funds that changed hands due to the battles in Clal Insurance, 85% of the acquisitions made by stakeholders can be attributed to the control battles.
This may be the reason why since the beginning of the current year, when there were a total of seven trading days, the Paz share rose by 16.2%, the highest increase in the Tel Aviv-125 index. , With a potential holding of 6.6%. Some people in the market estimate that Levy’s face is in control, although it is likely that this is a financial round for him.
The separation from control provided the largest sales in 2021
During 2021, stakeholders sold shares for a total of NIS 7.7 billion, an increase of 57% compared to the previous year, in which shares were sold for NIS 4.9 billion. It’s possible that groans in the form of strong performance of local stock indices (TA-125 and TA-35 each rose slightly more than 30% during the year), and the fear that this year’s rally will not repeat itself, are behind some sales. In practice, however, here too control plays a role, at least when it comes to the really big sales.
But it is the opposite direction. When it comes to sales, it is the separation from control that has provided the biggest sales. Thus, Sherry Arison sold 7.8% of Bank Hapoalim shares for NIS 2.9 billion, and was left with a 7.9% holding in the bank where it once held more than 20%. So did Shlomo Eliyahu, who sold the balance of his holdings in Mizrahi-Tefahot Bank (2.1%), which he received as part of the merger with Union Bank, of which he is one of the controlling shareholders, for NIS 489 million.
However, there are sales made against the background of the possibility of realization, such as the sale made by Pimi in Gilat. The private equity fund headed by Yishai Davidi sold 7% of the satellite company’s shares for NIS 320 million, after rising by 17% during the past year, and was left with a 20% holding. In addition, the car importer UMI sold 2.6% of Phoenix shares for NIS 250 million, after the insurance company’s share climbed 77% during 2021.
.