The man partnering Shlomo Zbeida in his bid to buy the Ace Buy & Build DIY chain from beleaguered businessman Gad Zeevi, is none other than Benjamin Gaon, Haaretz has learned.
Zbeida, Zeevi's partner in the DIY chain, submitted his offer to buy Zeevi's stock in Ace to First International Bank and attorney Lipa Meir, who is the court-appointed receiver for Zeevi's holdings in Ace. The offer valued the company at $22 million. Apparently Gaon, former head of the Co-Op Blue Square and now president of Gaon Holdings, will finance the offer while Zbeida will end up with a 35-50 percent stake.
Gaon has expressed an interest in Ace Buy & Build in the past, and decided to hitch onto Zbeida's bid, particularly after seeing IKEA's local franchise - on which Gaon also had a keen eye - sold off to Canadian billionaire Matthew Bronfman, without a tender.
According to an agreement between Zbeida and Zeevi, Ace cannot be sold off without the say-so of Zbeida, who holds both a right of first refusal and the right to participate in an offer of sale.
Ace is currently up for sale because Zeevi's Galaxo Group, of which it is part, went into receivership. Though the receiver intended to auction Galaxo's holdings in the DIY chain, this was postponed due to an ongoing legal dispute between Zeevi and Zbeida over their respective rights and holdings.
Sources in the market believe that Zeevi opposes such a private sale of Ace, and would prefer a public auction, believing that it would raise higher proceeds, all of which contribute to clearing his debts to First International. Other parties have expressed interest in Ace, including the Markstone fund and the Orgad brothers. Although Meir has apparently received a higher offer of $25 million for Galaxo's stake, the receiver may prefer Zbeida and Gaon's bid, which would resolve both the legal dispute and Zbeida's veto.
Ace Buy & Build runs 25 stores, plus 12 more in its Auto Depot chain. The company ended 2004 with net profits of NIS 9 million on sales of NIS 570 million. Operating profits grew 40 percent to NIS 13.5 million.
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