The Capital Market, Insurance and Savings Authority is set to approve the sale of shares in Phoenix Financial Ltd. (TASE: PHOE) to the Affinity Fund of Jared Kushner's, son-in-law of US President-elect Donald Trump. The approval is set to be issued on the last day before the option to exercise 4.95% in the insurance company's shares expires. With receipt of the approval, Affinity Fund's holdings in Phoenix, Israel's biggest insurance and financial company, will rise to 9.9%, making it the biggest shareholder in Phoenix.
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Phoenix is currently traded at a market cap of NIS 14.7 billion, after the share price has risen 60% over the past six months. Among the reasons for the jump was the deal by former controlling shareholders Centerbridge Partners and Gallatin Point to sell their holdings at a great profit to Affinity, Delek Group, and other investors.
Despite the expected approval from the Capital Market Authority, it is expected to impose restrictions, since the fund is a "Saudi fund" whose financial sources were raised mainly from Gulf countries.
5% of shares for NIS 470 million
Affinity acquired 4.95% of the Phoenix shares in July for NIS 470 million, and to exercise the option for an additional 4.95% it will pay a similar amount. After the deal, this fund will hold shares worth NIS 1.46 billion, so the fund has already made a profit 'on paper' of more than NIS 500 million.
The other largest holders in Phoenix are rival insurance companies Clal (6.7%) with shares worth NIS 991 million and Harel (5.7%) with shares worth NIS 847 million.
In the same sale of shares by Centerbridge and Gallatin, Delek Group, controlled by businessman Yitzhak Tshuva also purchased and then quickly sold a 4.9% stake, reaping a swift profit of NIS 120 million. In addition, Globes revealed at the time that the other investors were investment bank Lazard, which purchased 2%-3% of the shares, and investment fund Riverwood Capital, which held about 1.5% of the shares. This is a fund that had already invested in Phoenix in the past and returned for a second round in the Israeli insurance company.
Another investor that Globes revealed in the same round is US billionaire Henry Swieca, founder and director of Highbridge Capital.
In October and then at the end of November, Centerbridge and Gallatin sold the rest of their holdings in the company to additional investors from Israel and abroad.
Published by Globes, Israel business news – en.globes.co.il – on January 15, 2025.
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