The competition for the acquisition of Israel Military Industries Ltd. (IMI) has entered the home stretch. Five groups are bidding to acquire the state-owned defense company, whose price has been estimated at NIS 2-2.5 billion. The bidders are Elbit Systems Ltd. (Nasdaq: ESLT; TASE: ESLT); a group jointly controlled by businessmen Samy Katsav and Meir Shamir; businessman Ishay Davidi's FIMI Opportunity Funds; Renco Group, owned by American-Jewish billionaire Ira Rennert; and Flextronics-controlled Invictus Holdings, a special purpose vehicle founded for the purpose of competing for the acquisition of IMI.
The companies and groups interested in the acquisition are to submit their price bids next month to the Government Companies Authority, which is conducting the privatization process for IMI. Five companies so far have deposited a NIS 6 million guarantee, and when the bids are submitted, a NIS 35 million deposit will be required.
The Government Companies Authority yesterday summoned representatives of the five participating groups to a seminar in Herzliya. Representatives have already toured the site at Ramat Beka in the Negev to which IMI is slated to transfer its facilities by 2020. The competing groups also recently received comprehensive reviews of IMI's situation from chairman Maj.-Gen. (res.) Udi Adam and CEO Avi Felder, as well as confidential financial data about IMI revealed to the potential buyers in the information rooms opened three months ago.
Two companies that expressed interest in acquiring IMI, but subsequently dropped out, are Armaz, led by former IMI chairman Arie Mizrahi, and SBM Consulting, controlled by president and acting manager Shimon Ben Maimon. US company Coleridge Capital and Tara Horizon, owned by businessman Hezi Bezalel, also dropped out at an earlier stage.
According to the IDF privatization plan, the Government Companies Authority is expected to decide by the beginning of next year what group or company will acquire IMI. The state will retain a small part of IMI's activity defined as strategic and top secret, for which a new government defense company, Tomer Systems, was founded in recent months. The defense establishment is currently searching for a CEO for this new company.
A source informed about the IMI privatization plan expressed satisfaction to "Globes" with the pace of progress in the process. He said it was clear that "The five groups that have reached the final hurdle are serious, and are moving ahead with vigor in the process. Their level of interest in IMI is high, and most of the acute questions relating to the sale have already been answered. The discussions are now focusing the technical parts of the process."
Published by Globes [online], Israel business news - www.globes-online.com - on November 12, 2015
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