Israel's Clal sells 55% of Nesher cement unit to Livnats

Israel's Clal sells 55% of Nesher cement unit to Livnats
Published: 13 February 2012

Tagged Under: Nesher Cement Israel 

Holding company Clal Industries agreed to sell a 55% stake in Mashav Initiating & Development, the parent of Nesher Cement, to the Livnat family for ILS1.32bn (US$355m).

Clal will also receive ILS45m from a dividend Mashav will distribute prior to the deal, the company said in a statement on Sunday. It expects to post a capital gain of ILS750m-850m while its parent company IDB Holding Corp will post a gain of ILS400m-500m.

The sale is in line with the group's strategy to simplify IDB's structure, exit certain sectors and invest more abroad, he said. This strategy has been accelerated in the past year in the wake of a government committee's proposals to increase competition in the Israeli economy by breaking up some conglomerates.

As part of the deal, which is subject to regulatory approval, Clal will receive an option to sell its remaining 20% stake in Mashav to the Livnats.

The Livnats are part of the group that bought a controlling interest in IDB in 2003. Zvika Livnat is Clal Industries' co-CEO.

The controlling group in IDB is led by businessman Nochi Dankner and also includes the Manor family. The parties agreed that the Livnat family would sell its 13.3% stake in IDB to Dankner and the Manors within four years.

"We decided to sell a significant asset to improve the IDB group's financial position and increase its liquid reserves," Dankner said in a statement.

IDB owns 60.5% of Clal, whose holdings also include Hadera Paper, retailer Golf & Co, Clal Energy and Clal Biotech.

Meanwhile, the partners in Israel's offshore Tamar natural gas reserve said on Sunday that they have signed a US$680m contract to supply gas to Mashav Initiation and Development Ltd, which runs Nesher Israel Cement Enterprises Ltd.

The contract calls for Tamar to provide 200bnft3 of gas over 15 years, beginning in the second half of next year, when Tamar is expected to begin production.