Several months after acquiring its first shares in Gilat Satellite Networks Ltd. (Nasdaq: GILT; TASE: GILT), First Israel Mezzanine Investors Fund (FIMI), controlled by CEO Yishai Davidi, last night acquired a further 1.65 million shares (about 4% of the company's equity) at a price of $4.75 per share. The deal was worth $7.8 million (about NIS 30 million) and FIMI now has a 14.6% stake in the company.
FIMI acquired the shares from a number of sources, including businessman Meir Shamir, who sold $2 million worth of shares, and whose stake now falls to about 4%. He is expected to join forces with FIMI.
So far, FIMI has invested about $23 million in Gilat's shares, including purchases from Menorah Mivtachim Holdings Ltd. (TASE: MORA) several months ago and yesterday's acquisition. The average price paid for the shares is $3.89 per share. Since FIMI acquired shares from Menorah, Gilat's share price has jumped 43%, and its price was $4.99 per share at close of trading on Nasdaq yesterday.
This latest acquisition brings FIMI closer to York Fund's 19.6% stake, the largest shareholding in the company. York became an investor in Gilat in June 2005 when it bought Gilat's debt to Bank Hapoalim (TASE: POLI) and received an option to convert it to shares.
In September 2006, York converted the debt to shares for $71.4 million at about 35% above Gilat's current share price. Since then, York has sold some of its holdings. In Gilat's secondary offering at the end of 2006 it sold $20 million worth of shares at $8.50 per share, 70% above the current price.
Buying from York or linking up with it In contrast to FIMI, which is a private equity fund, which acquires control of companies and is actively involved in management, York is a hedge fund with purely financial investments. FIMI strives to be the controlling shareholder in companies in which it invests, and at this stage it is not yet clear if it will buy shares from York or join forces so that together the two funds will control Gilat.
Published by Globes [online], Israel business news - www.globes-online.com - on November 13, 2012
© Copyright of Globes Publisher Itonut (1983) Ltd. 2012