Israeli retailer Shufersal rejects Delek Israel merger offer

1 minute read

A man pushes a shopping cart outside Shufersal, Israel's largest supermarket chain, in the West Bank Jewish settlement of Mishor Adumim near Jerusalem May 5, 2013. REUTERS/Ammar Awad/Files Photo

Register now for FREE unlimited access to Reuters.com

JERUSALEM, April 13 (Reuters) - The board of Israeli retailer Shufersal (SAE.TA) on Wednesday rejected an offer to merge with Delek Israel, with the company saying the proposal did not comply with the strategy of Shufersal and its shareholders.

Last week, Delek Israel -- an operator of gas stations and convenience stores -- proposed to merge with the country's largest supermarket chain, Shufersal, and buy additional shares that could give it close to 20% ownership of Shufersal.

Delek Israel shareholders were offering to merge 100% of their company in return for an approximate 10% stake in Shufersal while its shareholders would then pay 100 million shekels ($31 million) for options that could bring their stake in Shufersal to 19.99%.

In a statement, Shufersal said Delek operates stores that are open on the Sabbath while Shufersal does not, and deviating from its principle may lead to economic harm.

It also cited the uncertainty in the industry Delek operates, including use of electric vehicles. "There's much doubt about the added value that a merging of these activities would bring to the company. Subsequently, it does not fit the company's strategy," Shufersal said.

Register now for FREE unlimited access to Reuters.com
Reporting by Steven Scheer Editing by Jeffrey Heller

Our Standards: The Thomson Reuters Trust Principles.