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The Azrieli real estate group has won the race to buy the controlling interest in Granite Hacarmel from Boroglen, a consortium of the Borovich family and the Glencore investment firm.

Azrieli tabled the highest bid, pricing the company at $275 million, which is about a billion shekels. The bid confers a premium of 31% on Granite Hacarmel, which holds controlling interests in the Tambour paints company, the Sonol chain of gas stations, and Super Gas, among other things.

The whopping bid from Azrieli beat Meir Shamir, Yishayahu Landau - who already owns 25% of Granite Hacarmel, and Shlomo Shmeltzer, owner of the New Kopel car leasing agency. Shmeltzer is believed to have stepped into the race because of the potential synergy between Sonol, which sells gasoline, and New Kopel, which uses it.

Merrill Lynch advised the sellers on the process.

Boroglen owns 55% of Granite Hacarmel, which trades on the Tel Aviv Stock Exchange at a company valuation of $210 million. Before the Borovich family bought the controlling interest in July 1998, Granite Hacarmel had been worth $347 million.

It is believed that Boroglen, in which the Boroviches and Glencore own equal parts, owes some $100 million to Bank Leumi, which financed most of the original acquisition in 1998.

But since its acquisition, Granite Hacarmel has paid its shareholders some $200 million in dividends.

During the years the Boroviches controlled Granite Hacarmel, it has more or less consistently underperformed the benchmark TA-100 index. Its performance was all the more painful in the years that Tel Aviv stocks shot skywards. In 2003, for instance,  Granite Hacarmel shares gained 10% while the TA-100 index gained 60%. Come 2004, the index rose by another 19% while Granite Hacarmel didn't budge. In 2005, the index of the 100 biggest companies added 29% and Granite Hacarmel lost 18%.

Nor did 2006 smile upon the stock, at least at first. It did practically nothing until August, and then shot up 25%, bucking the downgrade of its debt status by the Maalot rating agency. Therefore, from the start of the year, Granite Hacarmel shares have risen by 26% while the benchmark TA-100 index returned a mere 10%.