Osem Founder Dan Propper Sells Stake to Nestle

Multinational, which now owns 63.8% of Israeli food conglomerate, may delist company from TASE.

Dan Propper, the chairman of the Osem Investments food conglomerate, sold nearly his entire 5% stake in the company Tuesday to majority owner Nestle for $142 million. Propper, who has stood at the head of the company for 47 years, had his term as chairman extended last weekend until March 2016 and continues to hold 0.1% of its shares.

The sale raises Nestle’s stake in Osem to 63.8%. At NIS 92.67 per share, Propper received a 24% premium over their trading value on the Tel Aviv Stock Exchange following a 32% gain in price over the past 12 months. The transaction reflects a company value of NIS 10.25 billion.

The deal could reflect Nestle’s interest in taking the company private. Osem is among a very small number of the international food conglomerate’s holdings which are publicly traded. Propper, who took Osem public in 1992, has so far managed to convince Nestle not to delist the company.

Commenting on the possibility that Nestle will take Osem private, Propper said: “I can’t speak for Nestle. It probably will happen some day, but I don’t think that day is near since 37% remains in public hands and this is a significant chunk.” Propper also said the premium he derived on the sale was negotiated with Nestle and didn’t involve any control premium. “I’m identified with Osem but I never controlled it and never had a joint control agreement with Nestle,” he said.

Propper also sits on the board of Teva Pharmaceutical Industries and was recently mentioned as a possible candidate to take over as chairman when Phillip Frost completes his term in 2015.

David Bachar