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Clal Finance Batucha recommends that the public accept Elco Holdings' (TASE:  ELCO) offer to buy 22% of subsidiary Electra Consumer Products (TASE:  ELEK).

Elco is offering NIS 42 per Electra Consumer share. If the public accepts the offer in full, the company controlled by Gershon Salkind will be forking over NIS 183 million.

Clal Finance Batucha suggests that the offered share price, which is 48% above the target share price in the investment bank's last report on the company. The offered price  incorporates the company's potential.

The analysts also note that liquidity in Electra Consumer shares in low, which means that investors who want to move on, may have trouble finding buyers. Elco's offer gives them that opportunity on a silver platter.

For the first quarter of 2007 Electra Consumer reported a 1.5% drop in revenues to NIS 770 million, and a loss of NIS 8 million. In the parallel quarter it had lost NIS 39 million.

Electra Consumer started trade in Tel Aviv this morning at NIS 41.70, representing a market cap of NIS 813 million. This year its stock has risen 33%.

While Electra Consumer's first-quarter showing constituted an improvement, Clal Finance  says, it doesn't see much room for significant growth.