Delek Group (TASE: DELKG), controlled by Yitzhak Tshuva and managed by CEO Idan Wallace, is close to gaining control of Israeli credit card company Isracard (TASE: ISCD). The battle between Delek, Menora Mivtachim (TASE: MMHD) and Bank of Jerusalem (TASE: JBNK) for Israel’s biggest credit card company is now in the final straight.
Delek is in pole position after slightly improving its bid and comments from Isracard’s board of directors this morning that, “Based on all of the terms and aspects of the transaction, and taking into account its financial, legal and regulatory aspects, as well as the prospects for its completion within a reasonable period of time, this (Delek) is a preferred deal.”
Isracard’s board of directors will tell Menora Mivtachim that it is canceling the agreement signed with it in October to sell a controlling stake at a company valuation of NIS 3.15 billion.
Earlier this month, offers were received from Delek and the Bank of Jerusalem. Delek later improved the offer to a company valuation of NIS 3.56 billion, and referred to the penalty that Isracard is supposed to pay Menora for canceling the investment agreement. Bank of Jerusalem submitted an updated bid this week to merge Isracard into it at a valuation of NIS 3.8-4.2 billion for the merged company as a whole (in a share exchange deal).
Not the end of the story
However, this may not yet be the end of the story, and Menora may be able to submit another improved offer in the coming days, which would compel Isracard’s board of directors to reconsider and examine what the preferred offer is. Unless Menora does so, it appears that Delek has paved the way to taking over the credit company.
The Isracard board of directors explains in its announcement to investors this morning that “Even after weighing the financial terms of the Delek Group’s offer and the investment agreement with Menora, including the cancellation fee for Menora (a penalty for Menora of 4% of the investment amount), the holding percentage and other parameters, Delek Group’s offer reflects higher value for the company’s shareholders.”
Isracard’s board adds, “On regulatory matters, the prospects of feasibility of completing the deal, the reputation and experience of the bidders in the Israeli capital market and other key conditions, the company’s board of directors believes that the Delek Group offer and the investment agreement with Menora are equivalent to each other.”
Published by Globes, Israel business news – en.globes.co.il – on December 31, 2024
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