Rami Levy Ups Its Bid for Rival Israeli Supermarket Chain Mega

Upstart discounter now has highest offer, beating Yenot Bitan’s. in fight to buy bankrupt food retailer.

Rami Levy, founder and chief executive officer of Rami Levy Chain Stores Hashikma Marketing 2006 Ltd., Israel's largest discount food retailer, sits on a row of shopping carts outside a Rami Levy Supermarket in Jerusalem, Israel on Sunday, Nov. 23, 2014.
Bloomberg

The Rami Levy discount supermarket chain has increased its bid for the bankrupt food retailer Mega, making the highest of six offers, TheMarker has learned.

Rami Levy informed the court-appointed trustees administering Mega’s sale that it was raising its bid by 90 million shekels ($23.9 million) from an earlier offer of as much as 242 million shekels, not including the value of Mega’s inventory.

That would put it about 47 million shekels above Yenot Bitan’s top bid of 455 million shekels, including 130 million shekels for inventory. On Tuesday, the trustees told the court administering Mega’s sale that they preferred the offer from Yenot Bitan, a medium-sized chain that would emerge as Israel’s No. 2 food retailer if its offer is accepted.

Meanwhile, Moshe Ben-Moshe and two of Mega’s bank creditors demanded on Wednesday that creditors get a say in the sale of the supermarket chain, which would inevitably lead to another round of bidding.

Ben-Moshe, an Israeli-German businessman who is poised to buy control of Mega’s parent company, Alon Blue Square, also bid for Mega, but at 330 million shekels sans inventory it was one of the lowest offers. He was joined by Bank Hapoalim and Mizrahi Tefahot Bank, to which Mega owes 290 million shekels and 150 million shekels, respectively.

Mega’s trustees are likely to oppose any interference by creditors on the grounds that it would delay the sale.