Chinese Group Led by Harel Locker Drops Bid for Clal

Exit leaves only Microlink with an open offer for Israel’s No. 2 insurance company

Amos Ben Gershom

Only one bidder remains for the controlling stake in Clal Insurance, Israel’s second-largest insurer, after a Chinese investor group organized by Harel Locker, a former top aide to Prime Minister Benjamin Netanyahu, said Tuesday it was dropping out because the seller, IDB Group, wasn’t taking its offer seriously.

The departure of the Chinese group, a 70-30 partnership between Shanghai Gongbao Business Consulting and a Chinese government investment fund called Urban Transportation Investments, came a day after a second group led by Hong Kong tycoon Li Haifeng abandoned its bid.

That leaves only Microlink, also Chinese, left to make an offer for Clal by the December 31 deadline set by insurance regulators for IDB to reach an agreement to sell its 55% stake. Clal’s CEO, Izzy Cohen, and Haim Gavrieli, CEO if IDB Development Corporation, are now in China to try and wrap up final terms.

The Locker group, whose Israeli representative is the former director general of Netanyahu’s office, had made the highest of the three original bids, at 2.627 billion shekels ($580 million). But in a letter to IDB, the group said it felt its offer wasn’t being given equal weight with the others.

The offer by closely held Microlink is for just 2.48 billion shekels, but the group has said that the price is contingent on Clal’s shareholders’ equity remaining above 4.52 billion shekels at the end of the year, if not the offer falls to 2.42 billion.

Shares of Clal ended down 0.2% at 49.33 shekels and IDB shares 3.4% to 1.81 shekels.