The Bronfman-Schron Group continues to dilute its holdings in Israel Discount Bank (TASE: DSCT). Sources inform "Globes" that the Schron Group is today selling shares worth NIS 250 million (about 4%) outside of the Tel Aviv Stock Exchange.
Citi and Psagot Investment House Ltd. are distributing the shares. As far as is known, the Bronfman Group is not taking part in the sale. Sources close to the Bronfman Group say they have confidence in the abilities of the new CEO Lilach Asher-Topilski to lead the bank and they prefer to wait until the share price has risen.
Today's sale is part of the Bronfman-Schron Group's exit from the controlling core in Discount, which was first reported in December. According to the regulations set out by the Bank of Israel the Group has de-facto relinquished control of Israel Discount Bank which will be in transition as the Group reduces its stake to 5% over two years.
In December Bronfman-Schron sold a 5% stake in the bank, reducing its holding to 20%.
The Bronfman-Schron group will make a handsome profit on the exit from its investment in the bank but not a great one. They bought the shares for NIS 1.3 billion and their value has fallen. However, in 9 years the Group has earned profits of NIS 600 million reflecting returns of 46% on their investment or less than 5% annually.
Published by Globes [online], Israel business news - www.globes-online.com - on April 7, 2014
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