Ziel Feldman wins deal to buy Polar Investments

American real estate mogul Ziel Feldman is buying 40% of Polar Investments (TASE: PLR) http://www.themarker.com/eng/tools/toolsResult.jhtml?application=8&chosen=698019 for NIS 207 million. He will also get an option to buy another 12%, giving him control over the company.

Two and a half years ago Feldman lost a deal almost done to buy 30% of Polar, which is a subsidiary of Shrem, Fudim, Kelner (TASE: SFK) http://www.themarker.com/eng/tools/toolsResult.jhtml?application=8&chosen=422014. SFK pulled out after Polar's share price suddenly started to take off. It controls Polar via another publicly-traded company, Leader.

The transaction values Polar at NIS 517 million, post-money, and NIS 310 million pre-money, which is 35% greater than its present market capitalization on the Tel Aviv Stock Exchange.

It is also NIS 110-138 million below the evaluation of Polar that was revealed in financial statements published by Gmul, which owns 12.3% of the company. That appraisal valued Polar at NIS 422-448 million. Back in 2004, when Feldman snubbed the company, Gmul came in his stead.

Back in August 1986, SFK bought 23.86% of Polar - then called Poalim Investments - from Bank Hapoalim for NIS 197.8 million. The deal priced Polar at NIS 829 million.

During the following ten years, Polar Investments lost 75% of its value, which didn't stop its chairman and CEO, Avigdor Kelner, from earning NIS 5.3 million last year.

The 2004 deal with Feldman that foundered, was to have priced the company at NIS 60 per share. But then the stock started to rise and SFK canceled the sale.

Polar's share price is NIS 48 today and Feldman is buying it at roughly the same level SFK refused two years ago: NIS 61 per share.

In the space of five trading days in December, Polar shares have risen 22%, of which 5% were today, before the announcement, on lively turnover of NIS 1.1 million.