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Controlling shareholders in the Israel Phoenix Assurance Company, Joseph Hackmey (56%) and Shlomo Elihau (37.5%) have informed the Tel Aviv Stock Exchange that they are holding negotiations to sell their holdings in the company.

The move comes after previous efforts failed to separate their joint holdings, and have one of the parties take control of the company. The Israel Phoenix trades at a valuation of $400 million.

Eliahu today told that Hackmey is in charge of the negotiations and of setting a value for the deal. Elihau believes that the deal will be effected at over $450 million.

Hackmey, who now wants to sell off his controlling share in the company, proposed two months ago that he buy Eliahu's stake at a company valuation of $400 million. Eliahu tried to acquire Hackmey's stake at a company value of $500 million.

Neither offer was accepted.

One possible buyer for Hackmey's share is the Israel Land Development Insurance Company (ILD), controlled by the Nimrodi family. ILD Insurance declined to comment.

Another potential buyer is Manulife-Menorah, the Israel Life Insurance Company. It has been reported that Manulife-Menorah has approached the auditing firm of Lobowitz Kasirer to obtain a company valuation on Israel Phoenix.

Israel Phoenix's equity as of the end of 2000 came to NIS 577 million, life insurance revenues came to NIS 2.5 billion, and insurance fees came to NIS 1.9 billion. Its net profit reached NIS 228.3 million.

The Israel Phoenix is Israel's third biggest insurance company. It operates both directly, and via its subsidiary the Hadar Insurance Company, which at the end of 1999 merged with subsidiaries Dolev and Noga (formerly La Nationale). The Israel Phoenix has additional holdings, among them Mehadrin, Israel's leading citrus exporter.