Ben-Dov closes Partner purchase

Businessman Ilan Ben-Dov yesterday signed on the dotted line and acquired the 51% controlling interest in Partner Communications from the Hong Kong company Hutchison Whampoa, after receiving the final permit from the Communications Ministry earlier in the day.

Following arrival of the permit, the lawyers representing the parties met at the offices of Bank Leumi, which is financing part of the deal and which is buying 5% of Partner itself, out of Ben-Dov's stake.

Ben-Dov is expected to call a press conference on Sunday to announce his takeover and, while on the topic, to announce that the present management headed by CEO David Avner will be staying on. Ben-Dov himself asked Avner to stay on.

Ben-Dov struck the agreement to buy the controlling interest in Partner, one of Israel's three big mobile communications service providers, in August - agreeing to pay NIS 5.29 billion.

Of that, he's borrowing NIS 1.2 billion from Hutchison Whampoa itself as a vendor's loan. Ben-Dov raised another NIS 1.8 billion from Israeli investors, through bond offerings by his company Scailex.

Another NIS 500 million will be coming from selling Partner shares to Bank Leumi, and NIS 70 million each from Capital Research and Migdal, which are each buying interests of 0.7% of Partner's share capital.

Ben-Dov has a long list of assets that can serve as collateral for any bank loans he takes to pay the gargantuan bill, which will keep down the interest he has to pay on the loans.

For one thing there will be the shares of Partner itself. It seems his financing costs will amount to around NIS 200 million a year, on loans totaling NIS 3.5 billion. The loans will be serviced through income from Partner itself and Scailex.

Partner has been a highly profitable company, netting about a billion shekels a year.