Alfred Akirov and the real estate company usually under his control today (Wed) recorded a partial achievement when Clal’s shareholders chose the two nominees proposed by the company to Clal’s board of directors – David Granot and Aharon Fogel. However, the current chairman Haim Samet was also elected, so this is only a partial success for Akirov, which apparently will not be enough for him to thwart the purchase of the Max credit card company.
Before the vote, those in favor of the deal had five votes in the board of directors. The chairman Haim Samet, the boards of directors Varda Elshich and Mia Likvarnik (independent director) as well as the two external directors Yair Bar-Tov and Shmuel Schwartz.
They were opposed by two opponents – Meli Margaliot and David Granot, when the shareholders have to choose six out of seven names (the two directors do not come up for a vote). The five existing directors who come up for a vote were joined by the candidacy of Aharon Vogel and Mocki Abramovich, a veteran insurance man proposed on behalf of of another shareholder altogether, Eyal Lapidot.
● The Capital Market Authority prohibits Akirov from acquiring control at all through Alrov
● Guetta vs. Akirov: “A shareholder cannot inject his interest into the company”
● Alfred Akirov: “The illusory purchase of Max lowers Clal’s value to the floor”
After a long day that also included an unusual event (more on that later), only around 8:00 p.m. did the results of the vote become clear, when alongside Granot and Fogel, who oppose the deal, Abramowitz, who also opposes the deal, was elected to the board of directors. The one who was left out after the vote is Alsheikh. So that now in the board of directors there is an equality of four supporters of the Max transaction against four opponents. However, since Samet remains the chairman of the board, the deal’s supporters have an advantage within the board. This is not an ideal situation, but it will still allow Samet and the company’s CEO, Yoram Neve, to execute the purchase of Max.
We will recall that in April last year Clal signed an agreement with Warburg Pincus, which controls Max, according to which Clal will pay for 100% of the insurance company’s shares a sum of NIS 1.6 billion (part in cash and some in Clal shares), and will also transfer to it a debt of NIS 880 million, so that the deal gives Max Value of NIS 2.47 billion.
Alrov, which is the largest shareholder in Clal Holdings (15%), the parent company of Clal Insurance, opposes the move on the grounds that it is a too expensive transaction and one that does not meet Clal’s business strategy. Ever since the transaction became known, Balerov, which is still waiting for a control permit from the Capital Market Authority, tried to sabotage it and sent a series of harsh letters to the board of directors. Among other things, they repeated the claims of Sami Moalem, until recently a director at all, who claimed that Samet, who was active and pushed for the deal to take place, established a directors’ kitchen that included only those who supported the deal, and excluded from meetings held by that kitchen directors’ kitchen that opposed it.
We note that as part of the transaction, Warburg Pincus as well as other shareholders in Max – Menorah Mitvathim, Allied, as well as Clal’s own colleagues, are supposed to receive shares at all if the transaction is completed, which will dilute Alrov’s holdings in the company.
Haim Samet, chairman of Clal Insurance and Finance, admitted after the results were announced to the shareholders, “that he returned and expressed renewed confidence in the company’s board of directors and its members, and welcomes the two new directors – Aaron Vogel and Mocki Abramowitz.”
“Over the past two years, Kell has presented a positive turn in its results and enters 2023, with the aim of continuing to increase value for all of its stakeholders. I am confident that the extensive knowledge in the fields of insurance and finance that the new directors bring with them, together with the rich and diverse experience of the board members in all holdings and in all insurance, and in cooperation Working with the company’s management will help us continue to lead Clal to its success and its rightful place in the industry.”
Malerov stated in response: “The shareholders voted in favor of a change: the Clal board of directors is embarking on a new path, backed by a significant addition of experienced directors with relevant expertise in the core business and who will work for the benefit of the company and all shareholders. This, with the aim of bringing Clal to the lines of growth and success and making it a leading company in the industry “.
The vote was rejected by the Securities Authority
The voting results were supposed to be published already last week, when in fact the shareholders have already voted. However, the Real Estate Authority asked to postpone the vote, precisely due to claims that Alrov did not publish complete data to the public about a demand made to the real estate company by another regulator – the Capital Market Authority, which is the one that, as mentioned, should decide on the question of Alrov’s control permit in general. At the Capital Market Authority, Elrove requested reference to the extent of its debt, in order to verify that the real estate company complies with the provisions of the Centralization Law in regards to the separation of control between a real corporation (Elrove) and a financial corporation (Kel).
The Securities Authority saw this request as a sufficient condition in order to compel Alrov to fully disclose the data, so that the shareholders in general could understand the full impact of their decision on shaping the face of the board of directors in general, and thus the vote was rejected.
As mentioned, the voting did not go easily tonight either. Even before the publication of the results, the struggles between the insurance company and Alrov Real Estate, controlled by Alfred Akirov, continued. And that the counting of the votes and the publication of the results will be done at an unknown date after the closing of the assembly,” Elrov’s attorney, attorney Guy Gisin, wrote to Clal’s legal advice.
Gisin claims that according to the provisions of the law, the results of the vote should be presented to the general assembly before it is closed. “Therefore, my client demands that the assembly continue to take place (and not be closed) until it is legally concluded, after the end of the vote counting procedure and presentation to the assembly of the judgment and account of the results. Also, my client insists that her representative Mr. Moti Ben Avraham, who is at the meeting place of the assembly She will be allowed to remain throughout the counting process until the publication of the report on the manner of voting and its results,” Gisin added.
Today’s vote is of fundamental importance towards the completion of the transaction in which Clal acquires the credit card company Clal. If Alrov succeeds in influencing the composition of the board of directors, she will be able to thwart the deal she opposes on the grounds that it is too expensive – giving Max a value of 2.47 billion shekels, of which she has to pay 1.6 billion shekels in cash and shares.
Before the vote, those in favor of the deal had five votes in the board of directors. The chairman Haim Samet, the boards of directors Varda Elshich and Mia Likvarnik (independent director) as well as the two external directors Yair Bar-Tov and Shmuel Schwartz.
Opposing them were two opponents – Meli Margaliot and David Garnot, when the shareholders have to choose six out of seven names (the two directors do not come up for a vote). The five existing directors who come up for a vote were joined by the candidacy of Aharon Fogel and Mocki Abramovich, a veteran insurance man proposed on behalf of of another shareholder altogether, Eyal Lapidot.
In response, Mkalal stated: “The verification of the votes is complex and is done by the company’s secretary and on behalf of the board of directors, in accordance with the law. Alrov representatives were invited to stay until after the counting is finished, and the results are delivered, and they have the right to look at the voting records in Mkalal’s offices, and this during the accepted working hours, in accordance with the regulations. It should be emphasized that the company drives and will continue to drive with complete transparency and she requests to be allowed to carry out her work as a series. We regret that the Alrov company continues to criticize, unnecessarily.”