Rani Zim pulls NIS 250m deal in face of investors’ anger

In a surprising development, less than a month after Rani Zim sought to sell his holding in the commercial centers company that bears his name, Rani Zim Shopping Centers (TASE: RANI), to the other public company that he controls, Group Psagot for Finance and Investments (TASE: GPST), Group Psagot announced today that it had received a letter from Zim in which he stated that the anger of Group Psagot shareholders and the criticism levelled at him in the press had led him to change his mind and withdraw the offer.

Last month, Zim sought to exploit the cash accumulated at Group Psagot, which sold most of its financial business last year to other investment houses, and to promote a huge party at interest deal in which Group Psagot would buy his shares in Rani Zim Shopping Centers. The deal would have given Zim a NIS 250 million exit. Zim approached Group Psagot, of which he holds 65%, with a proposal that it should buy his shares and options in Rani Zim Shopping Centers, of which he holds 54%, for NIS 250 million (which was higher than the market value of the shares at the time of the proposal).

This afternoon, however, as mentioned, Group Psagot disclosed a letter from Zim to its chairperson Daniel Leventhal and CEO Yaniv Bender in which Zim writes, “Holders of securities of the company approached me expressing fierce opposition to the deal that was the subject of the proposal, and the press and media also criticized the deal.” He continues that, although he believes that the proposed deal is to Psagot’s benefit, “nevertheless, I am attentive to the holders of the company’s securities and I do not wish to go against the capital market and do something to the detriment of the company.”

Zim therefore gives notice that the proposal that was offered for Group Psagot’s consideration until May 15 has lapsed as far as he is concerned.

On the Tel Aviv Stock Exchange, the share price of Rani Zim Shopping Centers is down 2.91%, while that of Group Psagot is down 2.52%.

Zim was informed this morning that the Tel Aviv District Attorney’s Office (Taxation and Economics) had decided to close the case against him and Bender. Early last year, the Israel Securities Authority opened an investigation into suspicions of the use of insider information when Zim bought control of investment house Psagot in 2021.

Published by Globes, Israel business news – en.globes.co.il – on April 11, 2024.

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