JERUSALEM Aug 21 Israeli conglomerate IDB
Development said it had agreed to sell a third of its insurance
unit to Hong Kong's JT Capital Management for 1.472 billion
shekels ($413 million) to meet a court deadline for settling its
Li Haifeng's JT Capital will pay 83.1 shekels per share for
the 32-percent stake in Clal Insurance, Israel's No. 2
insurer, 30 percent more than Tuesday's closing price.
As part of a debt settlement process, Tel Aviv District
Court had given IDB, a unit of IDB Holding Corp, until
Aug. 22 to sell at least half of its 55-percent Clal stake.
Clal Insurance shares rose 2.15 percent to 65 shekels by
midday on Wednesday while IDB Holding was up 13.8 percent.
The court is due to rule on Sunday on whether IDB Holding
Chairman Nochi Dankner can keep control of the group. IDB
Development and IDB Holding's bondholders have proposed a debt
restructuring that would oust Dankner and give them full control
of a combined company.
Separately, Argentine businessman Eduardo Elsztain is in
talks with IDB Holding bondholders to invest 770 million shekels
in IDB Development in exchange for a 50.5 percent stake. His
proposal is less than Dankner offered bondholders last week, in
an agreement with mobile technology firm Emblaze, that
would see an injection of 826 million in IDB.
Before the court decision on Danker's control of IDB,
capital markets and insurance commissioner, Oded Sarig, has
ordered the transfer of IDB's Clal Insurance shares to a trustee
to ensure the running of Clal is not affected its sale.
However, the court said it will not allow Sarig to appoint a
trustee until he explains the decision.
JT Capital had been in touch regarding buying control of
Clal but Sarig said it was just in general terms and no details
had been discussed. When asked if he would approve the agreement
between IDB and JT Capital, Sarig said: "We are checking the
deal and checking the details." He will need to grant a special
permit for any transfer of control in Clal.
Many of the companies IDB owns have been hit by slowing
economic growth and increased competition. IDB Holding owes
bondholders 2 billion shekels and IDB Development owes a further