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Delek Investments and Properties closed a deal to buy 25.01 percent of Israel Phoenix Insurance from Shlomo Eliahu for NIS 720m. after receiving the necessary authorizations from the anti-trust commissioner and insurance supervisor last week.
Delek also acquired a nine-month option to buy Eliahu's remaining 8% in Phoenix for NIS 222m. The businessman is selling his shares to permit him to become part of a group that controls Bank Leumi.
Eliahu, who is already Leumi's largest private shareholder with a 10% stake, wants to combine his holding with that of US investment companies Cerberus Capital Management and Gabriel Capital.
Last month, their Barnea Investments consortium won a tender to buy a 9.99% holding in Leumi from the government and an 18-month option to buy another 10.01%.
Should the consortium exercise the option it would own 20% of Leumi, which the Bank of Israel has defined as a controlling stake.
Although Eliahu is interested in joining his stake with Barnea, he said just after the tender results were announced that he would not initiate any alliance.
"I am not going to do anything, but if they contact me I am willing to join my stake with theirs," he said.
Eliahu is also trying to sell his one-third stake in Union Bank of Israel (Bank Igud). Discount Bank is in talks to buy Igud, with Eliahu saying last month that the negotiations were taking place with the Landau family and the heirs of David Lubinski, who are the other major shareholders.
Eliahu said he was not involved in the negotiations but would sell his stake as part of the deal.
He couldn't be reached for comment by press time on Sunday.