Blooming an experimental balloon of Zim looking for a partner? In the background of the report on negotiations to sell Psagot’s fund activity to Phoenix, Psagot is flexing its muscles and denying the published outline. Phoenix is not signing the move either
The reader explained that following the developments surrounding the Psagot Investment House in the last day, he could have been confused about the possibility of selling most of the activities of the Psagot Investment House.
Yesterday, it was published in the media about negotiations conducted by Rani Zim, who controls Psagot (61.5%) with Phoenix CEO Eyal Ben Simon, for the sale of the core of Psagot’s operations – the mutual funds company of the investment house. In “Calcalist” they quoted a value of NIS 600 million, In the other media, they settled for a “value of over NIS 400 million.” Against the background of the publication, Psagot’s stock jumped by over 17% on the Tel Aviv Stock Exchange.
Zim is looking for a partner for the bloody peaks that carries with it a debt that carries an interest that in the meantime only rises. Just a year and a half ago, Zim purchased Psagot from Altshuler Shaham for about NIS 400 million, and for the benefit of the purchase he took a loan of NIS 255 million from Bank Mizrahi Tefahot.
The attempt to sell the activity a year and a half after the purchase at a value that reflects a significant overflow of value is quite ambitious, when since the purchase the macro conditions have changed significantly and not for the better, but mainly because the reported offer of NIS 600 million reflects 1.2% of the assets. If you look at the last transaction made in the Epsilon-Excellence market, which reflects a value of 0.45% on the assets, it can be concluded that the activity of Psagot is not worth more than NIS 300 million.
Psagot denies the publication published yesterday in the media according to which the group is conducting negotiations regarding the sale of the mutual funds activity, and writes that the engagement in the published outline “is not relevant and is not being examined by the company”. This announcement looks like the inflation of an experimental balloon since in Psagot they later write that “the group is in contact with a third party in connection with a potential contract concerning the activities of the investment house”. It can be assumed that Rani Zim wants to leave the door open to other offers that may be better.
Meanwhile, the Phoenix confirmed this morning that preliminary talks between the parties are indeed taking place, but these “have not yet matured and in any case the outline of the deal, the scope of the property being sold and the amounts stated in the various publications are not correct”. Both parties are fortifying their position when the negotiations have already gone into public discussion, it will be interesting to see at what value the activity will be sold in the end, which is currently perceived in the market as too high a value according to most opinions.