© Meir Edri, RANI ZIM PR
| Investing.com News |
The Psagot Group (TASE:), controlled by businessman Rani Zim (pictured above), announced on Thursday the signing of two agreements, the main of which is the sale of its portfolio management activities and basket funds to the Phoenix Group (TASE:).
For the purchases, Phoenix will pay approximately NIS 310 million, and after completion, Psagot is expected to record a net capital gain of approximately NIS 120 million and an increase in equity of approximately NIS 350 million.
Psagot’s stock has fallen by 34% in the last 12 months, but since the beginning of the year it has risen 11.9% and the company’s market value is now about 250 million shekels.
The Phoenix share is traded on the Tel Aviv Stock Exchange at a price of NIS 33.5, after an increase of about 3% since the beginning of the year, which reflects the company’s market value of about NIS 8 billion.
The transactions constitute a significant influx of value for Psagot, after about a year and a half ago, in August 2021, the company (formerly Valio Capital), through Psagot Investment House, purchased the companies Psagot Mutual Funds and Psagot Securities from Altshuler Shaham Investment House at a value of approximately NIS 405 million .
Psagot is now selling activities that include managed assets in the amount of approximately NIS 17.1 billion, and is left with activities that manage assets in the amount of approximately NIS 30 billion.
After the completion of the transactions, Psagot Investment House is expected to pay off a commitment of approximately NIS 255 million taken by its subsidiary, Psagot Mutual Funds, to finance the aforementioned transaction for the purchase of the activities about a year and a half ago, and to remain without financial debt, while increasing the cash to a balance of approximately NIS 165 million. In terms of Psagot, the two activities being sold are activities that were not characterized by growth and high profitability, and the investment house decided to focus on the other activities, which are considered to have more significant growth potential in their revenues and profits, alongside new activities that the investment house is developing as part of the strategic plan.
Avner Haddad, CEO of Phoenix Investments:
“The acquisition of the assets is another step in the realization of the growth strategy of the investment house and the group as a whole by creating value from acquisitions and mergers of assets with distinct synergy and by utilizing the competitive advantage of Kesem in the Israeli funds market. Psagot customers will join the hundreds of thousands of Phoenix customers, the leading investment house in Israel, and will benefit from the strength of the group and its capabilities in the field Investment management and the variety of financial services it provides”
Rani Zim, chairman and controlling owner of Psagot Group:
“The goal before our eyes is to deliver value to investors and maintain the stability of the company, especially in light of the fact that we are in a rising interest rate environment. CEO Yaniv Bander, together with the members of the board, led the company in a responsible manner over the past year and brought impressive results while delivering a distinct value. The investment house has a cash-rich current pot of NIS 165 million for the purpose of continuing to develop the company’s activities. At the same time, the company’s management is working to formulate a strategic plan that will present our vision for the significant development of the Psagot Group in the coming years. It is about focusing the activity on profitable and growing areas in terms of credit, investment management, stock exchange membership and brokerage, while entering and developing new areas and placing emphasis on technology and innovation, as well as expanding the range of alternative products for eligible customers.”