The deal to sell the controlling interest in the Israel Phoenix Assurance Company was closed at the end of last week, estimate sources near the negotiations. The sources say control over the insurance company will be transferred this week to the buyers.
Buyers Yisrael Kaz and Ya'akov Shahar will apparently be assuming control next week together with two minority buyers, say the sources. The two are operating via the car dealership, Meir.
Joseph Hackmey, Shlomo Eliahu and others will be receiving $450 million for their aggregate 95% interest in Phoenix.
One of the problems Shahar and Kaz faced in their takeover was that Phoenix isd costing them about NIS 1.8 billion, while the insurer's shareholders equity is only about half a billion shekels. The difference was supposed to be amortized in Meir's financial statements, which would have shifted it, the buying company, into a shareholders equity deficit. But Shahar claimed that since Meir is privately held, that should not be a problem.
Insofar as is known, Shahar and Kaz guaranteed the Supervisor of Insurance that they would make up any such equity deficit.
Phoenix finished 2000 with a net profit of NIS 118 million, compared with NIS 142 million in 1999 and a loss of NIS 12 million in 1998.
Even though the Kaz-Shahar group does not officially control Phoenix just yet, it has fired the first shot. Last week the insurer's CEO left, to be replaced by a Shahar ally, Bar Kochva Ben Gera, formerly the CEO of Hadar Insurance.