After holding out for several days, Moti Ben-Moshe has agreed to join with his partner in the IDB group, Eduardo Elsztain, in a plan to inject hundreds of millions of shekels into the in-debt holding company.
Ben-Moshe made known his consent at a meeting of the board of IDB Development Corporation on Thursday. He will be matching Elsztain’s proposal, made earlier this week, to inject some 550 million shekels ($141 million) in IDB through one or more rights offerings.
The 1.1 billion shekels will be enough to allow IDB to meet its debt obligations through the first quarter of 2016, time it will use to help revive some its flagging group companies and sell others, most notably Clal Insurance. Alternatively, the cash injection could leave the IDB group financially strong enough for Dorit Salinger, the commissioner capital markets, insurance and savings, to grant IDB an insurance license and retain control of Clal.
Nevertheless, Ben-Moshe has still not given his approval to the exact terms of Elsztain’s proposal. The two sides will have to hammer out the terms of the recapitalization – the price at which the rights offering will be set and how much minority shareholders will be diluted as a result.
IDB Development shares shot up 57% this week, to close at 1.99 shekels on Thursday on Elsztain’s plan.
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