With Real Estate Heating Up, Bino Bids to Sell Caniel

The controlling shareholders of Caniel, Zadik Bino, Avraham Biger and Modi Bar Shech, have been approached over the past weeks by investors interested in acquiring the company. The potential investors come from both the real estate sector and industry. Sources close to the negotiations estimate that its controlling shareholders seek to sell the company at a valuation of about $70 million, similar to the purchase value, after having withdrawn more than NIS 200 million in dividends. The sources say negotiations are at an advanced stage, although no binding agreements between the sellers and potential buyers have been signed.

Caniel is involved in the production of packaging for industry, including cans, bottles and packaging for food. Sources estimate that the awakening real estate market has led to renewed interest in Caniel, one of whose factories is located on a plot of land in Petah Tikva valued at $25 million. The land is designated for commerce and industry, and Caniel management is taking steps to rezone the land for residential use. The company's strategic plan includes transfer of the factory from Petah Tikva to the company's site in northern Kfar Sava, and selling off the land in Petah Tikva.

Caniel's largest shareholder, Bino, is interested in selling Caniel. An earlier round of discussions was conducted in 2004, when Dov Tadmor announced his intention to buy the company at a valuation of about $40 million. Other parties that have expressed interest in the company include Gazit-Globe and the Nir-David Group, which purchased Kargal.

Bino is also the majority shareholder of the gas company, Paz, the Ashdod refineries and the First International Bank of Israel. Estimates are that Bino has been interested in selling his holdings in the industrial company for some time now. Bino and his partners acquired control (80 percent) of Caniel in late 1998, at a company valuation of about NIS 300 million.

He later bought the rest of the company's shares from the public, and delisted the company. Biger was hired to restructure the company, which included the separation of the two company sites into separate legal entities, firing employees and downsizing management, and bringing it out of the red. The capital market estimates that the company is marginally profitable.