In August 2009, Phoenix will take over the coverage for DavidShield currently provided by Clal Insurance.
Israel Phoenix Assurance Ltd. (TASE: PHOE1;PHOE5) today signed an memorandum of understanding (MOU) giving it a call option on 33.3% of DavidShield Insurance Agency (2000) Ltd. at a company value of NIS 125-160 million. The company value of DavidShield will be linked to the Consumer Price Index (CPI) and bear 5.25% annual interest, as calculated from today.
Clal Insurance Enterprises Holdings Ltd. (TASE: CLIS) currently back's DavidShield's policies, under a contract that expires in August 2009. Phoenix will take over this contract and insure DavidShield's international health insurance activity for Israelis who reside abroad and who lack medical coverage from their Israeli carrier. Phoenix can exercise its call option within two years from taking over the coverage in August 2009.
Market source estimate that DavidShield posted a profit of NIS 15 million on NIS 82 million in premiums in 2007. The company was founded in 2000.
Phoenix is a subsidiary of Delek Group Ltd. (TASE: DLEKG).
Published by Globes [online], Israel business news - www.globes-online.com - on July 27, 2008
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