The Nuclear Control Core Agreement at Bazen Opens New Options: Eyal Lapidot, former CEO of Phoenix and Shikun VeBinui, is the prominent entity that maintains contacts with petrochemical creditors to provide them with financing for the acquisition of Bazen’s controlling shares from Idan Ofer’s Israel Company. Entrepreneur Ariel Shuv, who owns a significant share of land according to Glilot.
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Petrochemicals, the Israel Company’s partner in the control agreement with Bazen, holds 15.5% of Bazen and the first refusal to purchase the shares from the Israel Company for NIS 550 million – instead of NIS 588 million less a deductible dividend. This, following the deal that the Israel Company signed on April 17 to sell 16.7% of Bazan to the Hajj Group, subject to Petrochemicals waiving the right of refusal. The shares were sold at a price of NIS 1.1 per share.
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Right: Tzachi Hajaj and Eyal Lapidot
(Photo: Shaul Golan, Amit Shaal)
The controlling interest is 30% of the shares in Zen held by the Israel Corporation (16.7%) and Petrochemicals (13.3%), according to the control agreement in Zen signed in 2009. Petrochemicals, which is controlled on paper by David Federman, Yaakov Gutstein and Alex Pesal, is practically controlled by its creditors, the bondholders, to whom it owes NIS 1.3 billion and is NIS 419 million in arrears. The company suffers from a NIS 889 million deficit in equity, mainly due to the gap Between the value of shares in Zen in its possession – NIS 728 million – and the balance of the debt.
Last week, Petrochemicals reported that it had received written offers from several entities interested in financing the exercise of the right of refusal to purchase all the controlling interest shares sold by the Israel Corporation to the Hajj Group. Petrochemical is interested in exercising the right of refusal to enjoy the fact that the shares were sold by the Israel Company at a price of NIS 1.1 per share (NIS 1.05 after dividend), while the share price on the stock exchange is NIS 1.37. The acquisition of the shares embodies a business opportunity to increase the assets of Petrochemicals and increase the return to holders.
It is also an opportunity, under particularly exceptional conditions, even for Petrochemicals shareholders, to enjoy an upside if oil prices rise. This is a loan of NIS 550 million that will be granted by those who enter into petrochemicals so that it will exercise the right of refusal. The creditors, accompanied by attorneys Raanan Clear and Alon Binyamini, offer buyers a lien on the shares and an additional two-year option to purchase them at the price at which they purchase petrochemicals.
As far as is known, Lapidot is once again aiming to exercise the option and enter the controlling interest in Bazen while making a possible future attempt to purchase the shares of Petrochemicals in Bazen in order to reach a 30% holding in the company.
Again, he has a real estate background and a substantial shareholder, as mentioned, in Pi Glilot, which owns 164 dunams, most of which is leased to leasing and car rental companies. Lapidot, who is considered one of the most respected CEOs in the capital market, served as Phoenix The two largest companies in the field of insurance, and then was appointed CEO of Shikun VeBinui, a position from which he was fired only a year later, in July 2020, amid friction with Tamir Cohen, the representative of controlling shareholder Nati Saidoff.
Petrochemicals, which is controlled on paper by David Federman, Yaakov Gutstein and Alex Pesal, is practically controlled by its creditors, the bondholders, to whom it owes NIS 1.3 billion and is NIS 419 million in arrears.
Lapidot, which has accumulated an estimated fortune of more than NIS 200 million as CEO, decided to establish Lapidot Holdings – through which it competes for the loan for petrochemicals and the exercise of the option in the garden. 2008-2005 as CEO of Delek Israel and was also associated with Delek Europe and Delek US. Who owned refineries, so he has experience in the field of energy and probably believes in the field. According to sources involved in the matter, and who spoke with him, on behalf of the bondholders and Petrochemicals itself, his and Shuv’s ambitions in the deal are also real estate.
However, two material obstacles stand in the way of a financing deal and an option to purchase: one is the shortness of time. The option is for 45 days, of which 15 days have already passed. 30 days is too short a period of time for summary. A second obstacle that could frustrate the exercise of the right of refusal is the request submitted by the Petrochemicals’ Hs bond trustee, Reznik Paz Nevo, to exercise the lien held by the holders and appoint a receiver for the petrochemicals, whose holdings in the H-bonds hold 8.47% of the shares. Petrochemicals owes Series H holders 391, while the value of the shares pledged in their favor is close to NIS 400 million, and the holders of this series do not want to be exposed to fluctuations in the share price. 5 partners, trying to get into Hajjaj shoes.However, at the moment Lapidot is the most serious candidate if he overcomes the obstacles that exist in the way of any contender.
Petrochemical, which is managed by Rafi Arad, proposed in response to the bondholders to stop the foreclosure proceedings and exercise the liens, and as part of the debt settlement, Petrochemical will exercise the first right of refusal through financing of potential investors, and purchase the right of refusal shares. 32.2% After exercising the right of refusal, the company will offer the holders to receive in the arrangement, under certain conditions for each series, shares in Zen at the value of the debt or according to their share in the specific series’ lien.
The non-bank credit company Archimedes, which was founded by Eyal Lapidot and is managed by Tali Richman, provided a credit of NIS 240 million in the first quarter of 2022 – which is also the first quarter of its activity. This is a good opening for a company that operates in the field of real estate management and Lapidot holds the majority (about 60%) of its shares, which provided an additional NIS 580 million as part of the requirements of the Sale Law guarantees for 10 projects in the field of residential real estate development.
Archimedes is also in advanced talks to accompany 15 additional projects, amounting to about NIS 650 million.
The founding of Archimedes by Lapidot, along with Richman (35%) and Roi Yakir (5%), was first reported in Calcalist. The company began operating, as mentioned, at the beginning of the year. Yakir, who managed Shikun VeBinui Energy and was previously the chief investment officer at Phoenix and Clal Insurance, serves as a shareholder in the company and chairman of its credit committee and Lapidot as chairman. In her most recent role, Richman, the CEO, managed Discount Bank’s real estate portfolio.
Lapidot previously served as CEO of the Phoenix Insurance and Finance Group and as CEO of Shikun VeBinui. Archimedes is engaged in real estate financing through the provision of senior debt, Maznin debt, which is the completion of equity, and the execution of financial partnerships in urban renewal projects.