The Zeevi saga: The seven banks are opting for joint holding of the 20% share packsge

Authorities are unlikely to grant them their choice
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The seven banks that financed Gad Zeevi¿s purchase of a 20% stake in Bezeq met last night to discuss their options for seizing the collateral Zeevi provided for the loan, upon his failure to meet the conditions of the loan.

One option was to maintain joint holding of the shares as a single package, an option most effective in preserving the interests of all the banks involved.

When choosing this plan of action, the banks might come across certain legal difficulties. A top banker said yesterday that Supervisor of Banks Dr. Yitzhak Tal and Antitrust Commissioner Dror Strum, will examine more closely the connections of the banks with Bezeq, and the long-term implications of their 20% joint holding, one that will give them decision making authority in the national phone company.

The top banker added that the Supervisor of Banks and the Antitrust Commissioner will not allow the banks to keep their stake in Bezeq for long, and will revamp decision making mechanisms to inhibit the banks' influence on the company.

The joint holding of the banks in Bezeq may complicate matters for the company when it chooses a financing bank, and selects one from which to obtain a loan. The joint holding might also impede its freedom when it resorts to non-banking financing sources, such as bonds.

The main advantage of the joint holding is the control premium payment a potential buyer for the package will have to make. The advantage of a split holding is that banks can record it in their books as an investment, posting its real value rather than its market cap.

The banks now believe Dr. Yitzhak Suary's valuation of Bezeq will exceed the company's current market value.

The banks could put the share package up for sale; but it may prove difficult to find a buyer for the complete package. Should the banks split the package into their relative portions, they will have to relinquish the premium a single purchaser would pay.

The upcoming privatization of Bezeq will affect the price of the package, as well as the chances of finding a buyer for it.