U.S. investors eye IDB Holdings buyout
Jewish American businessman Daniel Strauss is considering buying out IDB Holdings if Nochi Dankner's bid to buy the company doesn't go through. Strauss heads a group of Americans who are considering investing hundreds of millions of dollars in Israel.
Negotiations on behalf of the Americans are being held by Israeli businessman Yitzhak Dabash, who formerly managed the Bronfman family's Renaissance Fund. Strauss and Dabash have met in recent months in Israel and New York with senior Israel banking executives, attorneys and businessman concerning possible investments in Israel.
Strauss has focused on the possibility of buying the controlling share in IDB Holdings if Nochi Dankner's bid to buy the company is not approved by the Bank of Israel. At the beginning of last year Strauss was involved in negotiations to join Nochi Dankner's consortium bidding for control of IDB, however these failed to mature. Sources close to Strauss emphasize that his interest in IDB Holdings is not an attempt to sabotage Dankner's business and is conditional on Dankner not going through with his bid.
Haym Carasso, one of the owners of IDB Holdings, said Monday that Strauss had turned to the Carasso family to investigate the possibility of jointly purchasing the controlling share in IDB Holdings should the Dankner deal fail to mature. Carasso said the family had clarified that IDB Holdings had signed a deal with Nochi Dankner and did not intend to violate that agreement, however should the deal not go through a deal with Strauss could be on the cards.
Carasso said Monday that the contacts with Strauss had arisen as a result of the difficulties the regulators have placed in the way of the Dankner deal and that he did not believe Dankner would in fact be able to complete his bid to buy IDB Holdings.
Carasso said that in view of the decline in the company's market value it was possible that prospective buyers would offer less than the value of $840 million set for the Dankner deal. Sources close to Strauss and Dabash noted recently that the price set for the Dankner-IDB Holdings deal was too expensive. They said that the company's market value currently stood at some $520 million and that the premium for the controlling share should not exceed 25 percent and therefore a valuation of $700 million would be considered reasonable.
According to Carasso, if the Dankner deal does not go ahead and prospective buyers wish to buy the company for a lower valuation, IDB holdings still had the option to wait for market conditions to improve. He said that IDB Holdings chairman Udi Recanati, the driving force behind the decision to sell the controlling share in the company, would agree to wait a year or two until conditions improve.
A spokesman for Nochi Dankner's Ganden group said that the Ganden, Livnat, Manor consortium would complete the purchase of IDB Holdings.