Haim Saban bowing off the screen? May sell Keshet stake

Businessman Haim Saban has decided to sell his 24% stake in Channel 2 franchisee Keshet, and to increase his holdings in the Bezeq (TASE: BZEQ)  phone company.

His decision is reportedly driven by sour relations with the biggest shareholder in Keshet, Mozi Wertheim (38%).

Saban also prefers to avoid the potential of having limitations imposed on Bezeq's activities in content and Internet because of his cross-ownership.

If he does sell his Keshet shares, he'll have done well by the investment, returning more than double his stake. When he bought into the Channel 2 broadcaster at the end of 2004, the company was worth $12 million. Today it's estimated to be worth about $30 million.

One of the reasons for tensions between the Keshet shareholders had been the idea of merging with Reshet, the other Channel 2 franchisee. The two companies would be allowed to merge after November this year, or two years after their second franchise term began. But the shareholders have no consensus over any such move.

Bezeq stock

A merger would improve the two companies' financial situation: profits would grow and they would be spared the nuisance of having to divide up broadcast days. They could stop spatting over prestige and slash costs on management, marketing and content, too.

The Saban group reportedly wholeheartedly supports a merger with Reshet, but as of writing, no progress was being made in that direction.

Another reason Saban might decide to wash his hands of Keshet, is that because he owns a controlling interest in Bezeq, he is not allowed to increase his Keshet stake beyond 24%.  In any case, he couldn't increase his clout at Keshet, let alone at the merged company.

Meanwhile, Saban wants to increase his stake in Bezeq. He, the Apax investment fund and former pharmaceuticals baron Mori Arkin jointly own about 30% of the national phone company. There are two ways he could increase his interest, one being to buy the banks' holdings in the phone company. (The banks got stuck with 17.6% of Bezeq's shares after businessman Gad Zeevi defaulted on massive loans he'd taken to buy 20% of Bezeq from Cable & Wireless.)

Or, he could exercise an option the Bezeq buyers received from the state when it privatized the phone company, to buy up to 10% more of the company shares.

"Saban faces three possibilities," explained Moshe Debi, Saban group spokesman. "He could increase his interest in Keshet, leave things as are, or sell the Keshet holding." Mozi Wertheim refused to comment.

	Haim Saban