The decision of the Capital Market Authority regarding the application for a control permit in Clal Insurance submitted by Al-Rub Akirov Real Estate has not yet been made, but the Knesset members are not waiting, and they held a stormy meeting of the Finance Committee, in order to prevent the control permit from Al-Rub. Heaviness towards the Capital Market Authority and its head, Dr. Moshe Barkat.
“Giving a person control over so much money is a catastrophe,” said MK Naama Lazimi (Labor Party). “She referred to Zimi. She referred to allegations that Akirov wants to acquire control in general after the insurance company, as a minority shareholder in Alrov, had previously opposed a stakeholder deal that was supposed to benefit Akirov’s son, Georgi, who leads Luca, a hotel arm. The prestige established by Alrov in Europe.
“I expect the Ministry of Finance to intervene now to stop this thing. It is a breach of trust by the financial system towards us. It seems to me that the gatekeepers are asleep standing and it is an unlikely situation. The situation is reversed? We are the gatekeepers, and there are professionals here.” , And in light of the request of the chairman of the Finance Committee, Alex Kushnir (Yisrael Beiteinu), that she wait with the audit for the end of the investigation, told Zimi that “I wish myself to apologize for these things, but we know very well what is going to happen.”
Alfred Akirov / Photo: Yossi Cohen
“Akirov is not just about finances, so the fear is growing”
MK Yaakov Margi (Shas), who submitted the request to discuss the issue, said that “if Akirov had only dealt with finance, there would have been no problem, but he does not only deal with finance, so our concern is growing.”
MK Ofer Kasif (joint list) raised the issue of Akirov’s family ties and their impact on his business. “There is a question of nepotism when it comes to Akirov. We all know the attempt to put one of his sons in the insurance company when he has no experience (Akirov said in the media that he intends to appoint his son Georgi as a director in general, but later withdrew from it – R. V.).
“When he tried to get Georgie into a deal with Luca, those who opposed were Yoram Naveh (Clal’s CEO) and Yossi Dori (Clal’s investment manager, R. V.) and as a result Akirov tried to fire them. So I ask: if we know about this specific background where he has been stirred to overthrow the incumbents, and that is a fact and not a theory, is it right to give such a person even more power? ”Kasif wondered.
“We also examine the person himself”
Barkat himself participated in the beginning of the discussion through a video call, and said that he, as a professional regulator, examines the good of the economy and the good of consumers first and foremost. “I come with a very big responsibility first of all towards the public. There are professional processes that need to be done and I do not work according to such and such rumors or claims towards this or that person.
“We have very clear rules that have not been set since yesterday. We examine everything and receive information from all bodies and all regulators, look at everything – also the law of centralization, the leverage of Akirov, we also examine the person himself,” Barkat explained.
On the allegations made against him, Barkat said: “I came to volunteer and do for the public good. I have a social conscience, and I do not intend to be a politician. Some things have already been referred to us, and I am glad that the Knesset recognizes the value of the Capital Market Supervisor.”
The Legal Adviser of the Capital Market Authority, Baruch Lubert, was asked to update on the status of the inspection conducted by the Authority, noting that the Authority could not provide details. “The commissioner is facing a request for a control permit, and we are prevented from addressing specific factors. The request is examined in accordance with the provisions of the law,” he said, noting that if Knesset members want to change the law, it is their authority.
During the debate, MK asked Zimi what can Knesset members do to prevent the Capital Market Authority from granting the control permit to Alrov (the largest shareholder in general, which holds 15% of the company’s shares and wants to double its holdings to 30%).
“Apply for a restraining order and at the same time change the law”
To this, MK Margie replied that they could petition the court, apply for a restraining order and at the same time act to change the law, referring mainly to the Centralization Law, which allows control of a significant real corporation in parallel with a significant financial corporation.
It should be noted that at present Alrov is not defined as a significant real corporation, and therefore, on the face of it, it can control at all, which is a significant financial corporation. This is because at present the volume of Alrov’s debt is less than NIS 6 billion. The Capital Market Authority is considering requiring Alrov to list its debt abroad for the purpose of the examination, in order to ensure that even with this debt, in which Alrov took out loans of more than NIS 5.5 million from banks abroad, it still meets the limitations of the Centralization Law.
Committee chairman Kushnir summed up the discussion and said that the issue raises a lot of red flags. “However, I demand that the PA take seriously both Akirov’s history and the issues raised here, because this is NIS 260 billion in savings,” Kushnir said.
Malrov responded: “The Alrov Group is a company whose majority activity is in foreign markets, and therefore it allocates a significant portion of its equity to investments in the Israeli financial sector.
The group has a low debt ratio, has extensive experience in investing in the financial sector – including successful investment over the years in Poalim and Leumi banks – and believes that the fact that it aspires to obtain a control permit from Clal Insurance Company is a certificate of honor for the Israeli economy.
“Alrov Group is well acquainted with the regulation of the insurance sector and will adhere to the guidelines regarding the management of the insurance company after receiving the control permit, through experienced and quality directors and professional and experienced management. Alrov’s thinking and vision has always been based on long-term strategy. “All this, in order to improve the company first and foremost for the benefit of its customers, colleagues, employees and shareholders.”
Clal Report: Alrov returns to a 15% holding
At the same time as the discussion, Clal Insurance reported to the stock exchange that Alrov returned to hold 15% of its shares, after its holdings were slightly diluted due to an issue of shares that Clal made about two weeks ago. In the IPO, Clal raised more than half a billion shekels, after rejecting Alrov’s offer to purchase the shares for sale outside the auction, and at a higher price.
Alrov participated in the tender and purchased shares at a rate of about NIS 60 million, and now during the trading it purchased additional shares in the amount of NIS 10.5 million, in two different transactions and at a price slightly lower than the issue price.