June 3, 2012 / 9:06 AM / 8 years ago

UPDATE 1-Hutchison in talks buy back control of Partner Comm

* Hutchison sold Partner stake in 2009 for $1.38 bln

* Suny would buy Scailex’s mobile phone business

* Trade in Partner, Scailex, Suny suspended in Tel Aviv (Adds details, background, media reports)

By Tova Cohen

TEL AVIV, June 3 (Reuters) - Hutchison Whampoa of Hong Kong is in advanced talks to acquire control of Scailex , the parent company of Israeli mobile phone operator Partner Communications .

Hutchison sold a controlling stake in Partner, Israel’s second-largest mobile phone operator, to Scailex for $1.38 billion, or $17.50 a share, in 2009. That is well above Partner’s closing price of $4.49 on Nasdaq on Friday.

The purchase price included $1.08 billion in cash and a secured debt instrument of $300 million.

Partner, which operates under the Orange brand name, and its rivals have come under pressure in the past year from increased competition and regulatory changes.

The government forced mobile operators to slash fees they charge each other to connect calls and to scrap exit fines for customers. The government also issued new licences to create more competition and push prices down in a market dominated for more than 12 years by three groups.

Debt-laden Scailex, a subsidiary of Suny Electronic Inc , is the sole importer of Samsung mobile handsets in Israel. Suny said on Sunday it would acquire Scailex’s import activities for Samsung phones in parallel to Hutchinson buying control of Scailex.

It did not disclose a value for the deal or any other financial details.

Scailex holds 44.54 percent of Partner’s shares, worth 1.2 billion shekels ($307 million), while Suny owns 1.4 percent. Scailex and Suny are controlled by Israeli businessman Ilan Ben-Dov.

According to the Maariv newspaper, Hutchison would acquire 60 percent of Scailex for 1.5 billion shekels — 400 million shekels in cash and forgiveness of the $300 million loan extended to Scailex when it bought Partner.

Scailex had expected to finance the loan with dividend payments from Partner. But the company, which has seen its profit fall sharply, last paid a dividend in the third quarter of 2011.

Scailex also owes 1.8 billion shekels to bondholders, who would have to approve the deal, Maariv said.

Shares in Partner, Scailex and Suny did not open for trade on Sunday in Tel Aviv.

“As of the date of this announcement, no binding agreement has been signed and there is no certainty that such an agreement will be signed,” Suny said in a statement to the Tel Aviv Stock Exchange.

The transaction would be subject to receipt of various approvals, including that of shareholders in Scailex and Suny as well as Israel’s Communications Ministry.

$1 = 3.91 shekels Reporting by Tova Cohen, Editing by Jonathan Thatcher

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