The long arm of the government's competition committee has reached Yitzhak Tshuva's Delek Group, which said on Thursday that it is exploring the sale of Phoenix insurance unit to one of several potential buyers, including the legendary American private equity fund KKR.
"In the process of examining the possible sale of the company, we have held meeting with parties interested in acquiring a holding in the company, among them KKR," Delek said in a statement.
"These are initial contacts only and it is not clear that any kind of agreement will arise from them," Delek said.
Delek Group controls 48% of Phoenix's share capital, which trades at a market valuation of NIS 1.9 billion. It is believed that Delek is seeking about NIS 800 million for its stake in Phoenix, which would value it at 10% less than its market price.
Shares of Phoenix barely changed in Tel Aviv Stock Exchange trading on Thursday, closing at NIS 8.58.
KKR, based in New York, is managed by Henry Kravis and George Roberts, two cousins who serve as joint CEOs. John Mack, who stepped down as chairman of the U.S. investment bank Morgan Stanley and is regarded as one of the most powerful figures on Wall Street, joined KKR in April.
Formerly known at Kohlberg, Kravis, Roberts & Co., its 1987 leveraged buyout of Nabisco for $25 billion was chronicled in the book "Barbarians at the Gate: The Fall of RJR Nabisco."
The negotiations toward selling Phoenix come against the background of the recommendations of the government's committee on economic concentration, which were published about in March.
Among other things, the panel proposed that groups with operations in excess of NIS 6 billion shekels annually be banned from controlling financial and non-financial holdings together.
That has created a situation in which many companies are being put on the sale block.
