IDB Development Corporation, controlled by Eduardo Elsztain, notified the Tel Aviv Stock exchange this morning that it had signed an initial, non-binding memorandum of understanding (MOU) for the sale of control of Clal Insurance Enterprises Holdings Ltd. (TASE: CLIS) (45%) to a Chinese public company, at a value close to that of Clal Insurance's shareholders' equity, that is, some NIS 4.88 billion.
If there is no deal, there will no penalties for either side, and the initial agreement is for 60 days exclusivity in examining Clal Insurance. The potential buyer is Huabang Financial Holdings Limited, which is listed on the Hong Kong stock exchange.
If a deal is struck, the consideration will be adjusted according to Clal Insurance's shareholders' equity in its last consolidated financial statements released before the completion date of the deal, and also for dividend distributions and any other events affecting the company's capital that might occur before the completion date.
The deal is subject to a due diligence examination by the buyer. Completion will be subject to a number of pre-conditions, among them regulatory approvals, including that of the head of the Capital Markets, Insurance and Savings Authority Dorit Salinger, and any third party approvals that might be required. Previous deals for the sale of IDB Development's stake in Clal Insurance foundered because Salinger's approval was not forthcoming.
Published by Globes [online], Israel business news - www.globes-online.com - on September 5, 2017
© Copyright of Globes Publisher Itonut (1983) Ltd. 2017