Menorah Insurers Reports a huge deal in the field of insurance agencies in which, acquired 50% of the agent house Champions. The total consideration that Menora Mivtachim will pay is NIS 140 million, and if certain conditions are met, it will pay an additional NIS 10 million.
The Champions Group was founded about 30 years ago by Alex Chernomordic who is the current CEO and owner. Chernomordic will continue to manage the company and hold 50% of the shares in it. 600 agents, which makes it one of the largest and leading agent houses in Israel.
The big difference between an agency and an agent’s model is that while agents belonging to the agency are its employees in every way, operationally and economically, whereas agent agents rent services from the agent’s house.
Menora Mivtachim noted that the acquisition produces another profitable leg with low dependence on the capital market. Alifim will become the third insurance agency in which Menora has strong insurers, after the Orot agency and the Sinai agency (which it holds through the Shomera insurance company).
As part of the transaction, the Menora Mivtachim Group will allocate to the Champions a line of credit for acquisitions of additional agencies and veteran agents, with the agreement stipulating provisions regarding purchase and sale options to the parties in accordance with the agreement.
Completion of the transaction is subject to acceptable conditions precedent, including regulatory approvals of the Commissioner of the Capital Market and the Competition Authority.
Ari Kalman, CEO of Menora Mivtachim Group “The acquisition is part of the implementation of the group’s strategy, to increase profitability and activity in companies with dependence and low impact on the capital market and their activity synergistic with the group’s core activity.”