Sirius International Insurance’s proposed acquisition of the Delek Group’s 52.25% stake in insurer Phoenix Holdings has been cancelled due to failure to secure regulatory approval.
According to Delek, the plan to purchase its holdings in Phoenix came in two stages. Sirius first bought a 4.9% stake for NIS208 million (US$56.67 million). Then the second stage would involve the remaining 47.35% for NIS2.3 billion (US$628 million). However, Sirius was unable to obtain permission from Israel’s Capital Markets, Insurance, and Savings Authority, reported Israeli business newspaper Globes.
The agreement between Israeli business group Delek and Chinese-owned Sirius was announced in November 2017. It had a clause that if the conditions for completing the agreement were not fulfilled within eight months, the second stage of the deal would be considered null and void.
With the deal called off, Delek is free to find another buyer, or sell its shares on the stock market. According to the report, the latter option is more likely, due to the price of Phoenix’s shares rising by 23% since the agreement was signed.
Delek has been unsuccessful in selling its stake in Phoenix for over six years, due to concerns from Israeli regulators about foreign takeovers of the company, which also manages pensions.
