Treasury opposes insurance co sales to Chinese - report

Phoenix
Phoenix

The Ministry of Finance does not want to put Israelis' pension money into Chinese hands, "Bloomberg" reports.

Delek Group Ltd. (TASE: DLEKG), controlled by Yitzhak Tshuva, has a problem, at least according to the "Bloomberg" news agency. "Bloomberg" reports that the Israel Ministry of Finance is opposing the sales of insurance companies to Chinese investors because it does not want to put Israelis' pension money into Chinese hands, according to a government source involved in the matter.

The report is liable to prevent the sale of Delek Group's 52.3% controlling stake in The Phoenix Holdings Ltd. (TASE: PHOE1;PHOE5) to Chinese holding company Fujian Yango Group for NIS 1.95 billion.

The Promotion of Competition and Reduction of Concentration Law requires Delek to sell its controlling interest in Phoenix. Delek is not waiting until the deadline for selling its stake under this law; it wants to sell as soon as possible as part of a strategic switch to energy in its business focus.

In late 2016, sources reported that conditions had emerged for approval of the deal by Capital Market Authority director Dorit Salinger, but this assessment may have been overoptimistic.

The government source said that many Chinese investors had no clear advantages in savings management, and data concerning their previous record were lacking. The source added that the government was more willing to approve Chinese investments in industrial assets where pension money was not at risk. Chinese investors have been the primary bidders for Israeli financial assets.

Published by Globes [online], Israel Business News - www.globes-online.com - on January 4, 2017

© Copyright of Globes Publisher Itonut (1983) Ltd. 2017

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