www.bethelfinance.com
Bethel Finance news:
Antitrust Authority director general David Gilo has delayed a deal for Potash Corporation of Saskatchewan Inc. (NYSE; TSX: POT) to increase its 14% stake in Israel Chemicals Ltd. (TASE: ICL) to 25%, because he wants to examine the antitrust consequences of the deal, and he could seal its fate. The Antitrust Authority said, "The issue is under review."
The Ministry of Finance has agreed in principle to the deal. Senior ministry officials confirmed the report. Potash Corporation and the ministry have been in talks on the matter for six months.
The Government Companies Authority has already concluded its review on the security aspects of the deal, which concluded that the government must approve any increase in Potash Corporation's stake in Israel Chemicals. The conclusion is based on the state's golden shares in Israel Chemicals as the holder of natural resources.
The Government Companies Authority also found no grounds for concern that the deal might affect corporate governance at Israel Chemicals. This is because the company's article of incorporation stipulate that directors are elected by a simple majority, and since Israel Corporation (TASE: ILCO), controlled by Ofer Holdings Group, will continue to own 52% of Israel Chemicals.
Israel Corporation consented to the talks between Potash Corporation, which is also a major competitor of Israel Chemicals, and the government. The companies agreed on full transparency in any future Potash Corporation plans for Israel Chemicals and that the purchase of shares will be coordinated with Israel Corporation.
Potash Corporation may want to increase its Israel Chemicals to strengthen its position in Asia. Israel Chemicals has large sales in both India and China, partly because of Israel's proximity to them. Potash Corporation has no presence in either country due to its geographical distance.
Five years ago, Israel Corp. blocked an attempt by Potash Corporation to acquire control of Israel Chemicals. It is hard to say whether control of Israel Chemicals might change hands in the future. On the face of it, Israel Corp. has no reason to sell the company, which provides hundreds of millions of shekels in dividends every quarter, which Israel Corp. uses to finance its other operations, including financially troubled Zim Integrated Shipping Services Ltd. and its electric car venture Better Place LLC.
Israel Chemicals' share price was unchanged today at NIS 36.80, giving a market cap of NIS 46.8 billion.
No comments:
Post a Comment