China’s Fosun International, which in June agreed to buy control of Israeli insurer Phoenix, is now in talks to buy Ahava, the maker of skincare treatments based on Dead Sea minerals
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Fosun is in talks to buy a controlling stake in Ahava, which has earned the wrath of the global boycott movement because its plant is located on the West Bank’s Dead Sea shore, at a company valuation of $60 million.
At this stage it’s not clear whether Fosun is interested only in buying the 35% of Ahava controlled by Gaon Holdings, the Livnat family and Shamrock Holdings, the investment vehicle of a wing of the American Disney family – or the entire company. The three control a combined 53% of Ahava.
The other shareholders are nearby kibbutzim – Mitzpeh Shalem with 35%, a group of local kibbutzim with 6.7% and Kalia with 5.8%.
Gaon Holdings, which is publicly traded but declined to comment on possible talks, is leading the drive to sell Ahava as part of its strategy of focusing on its core agro-business activities, including Middle East Tube. Over the last two years, Gaon, which is controlled by the Viola private equity group, has sold a small stake in the financial services from Meitav Dash, a German property portfolio, and has put Ahava on the block now.
Shamrock, once a major investor in Israel with holdings in Koor and sandal-maker Teva Naot, has been paring back its Israeli portfolio in part due to pressure from two its shareholders, Tim and Abigail Disney – children of Shamrock founder Roy Disney – to divest holdings over the Green Line. Three years ago, Abigail Disney renounced her share of the family’s profits in Ahava, saying it is engaged in the “exploitation of occupied natural resources.”
Ahava has been targeted by the global boycott, sanctions and divestment movement because of its plant located in the West Bank. Four years ago it was forced to shutter its London store after months of noisy demonstrations by pro-Palestinian groups.
Ahava, which employs about 225 people and had turnover last year of 184 million shekels ($48.3 million), now faces an additional threat from the European Union, which is considering a rule that would require Israeli companies in the West Bank to label their products accordingly, which would make it easier for boycotters.
In May, Ahava said it was weighing building a second plant inside Israel on the shore of the Dead Sea, but denied it was connected with the boycott.
Fosun, backed by Chinese billionaire Guo Guangchang, has been on an acquisition spree, buying insurance companies, energy companies and properties overseas in Australia, Italy and New York.