Warburg Pincus finalizes $700m. Leumi Card acquisition

Based in Bnei Brak, Leumi Card has issued more than 2.6 million credit cards and offers merchant acquiring services to over 40,000 businesses.

By
March 5, 2019 16:13
2 minute read.
Warburg Pincus finalizes $700m. Leumi Card acquisition

Pedestrians are reflected in the windows of a branch of Bank Leumi, Israel's second-largest lender, in Tel Aviv, Israel. (photo credit: NIR ELIAS / REUTERS)

 
X

Dear Reader,
As you can imagine, more people are reading The Jerusalem Post than ever before. Nevertheless, traditional business models are no longer sustainable and high-quality publications, like ours, are being forced to look for new ways to keep going. Unlike many other news organizations, we have not put up a paywall. We want to keep our journalism open and accessible and be able to keep providing you with news and analysis from the frontlines of Israel, the Middle East and the Jewish World.

As one of our loyal readers, we ask you to be our partner.

For $5 a month you will receive access to the following:

  • A user experience almost completely free of ads
  • Access to our Premium Section
  • Content from the award-winning Jerusalem Report and our monthly magazine to learn Hebrew - Ivrit
  • A brand new ePaper featuring the daily newspaper as it appears in print in Israel

Help us grow and continue telling Israel’s story to the world.

Thank you,

Ronit Hasin-Hochman, CEO, Jerusalem Post Group
Yaakov Katz, Editor-in-Chief

UPGRADE YOUR JPOST EXPERIENCE FOR 5$ PER MONTH Show me later

Global private equity firm Warburg Pincus has completed the acquisition of leading Israeli credit card company Leumi Card in a deal worth NIS 2.5 billion, the companies announced Monday.

Leumi Card, one of only three major credit card companies in the Israeli market, has been under the ownership of Bank Leumi (80%) and the Azrieli Group (20%).

Following the receipt of a Bank of Israel permit to control the company last week, ownership of Leumi Card has effectively been transferred to the New York-based private equity firm.

As part of the deal, Warburg Pincus collaborated with three strategic partners: Menorah Mivtachim, Clal Insurance & Finance and Allied Group. Each partner will hold 5% of the company’s shares, while Menorah and Clal will further increase their holdings to 10% each once relevant regulatory approvals have been received.

Under a wider strategic restructuring process currently underway at Leumi Card, the company is soon expected to rebrand and change its name to “max.”

“Leumi Card is an excellent business that we hope to bring our global expertise to, and help build a true leader and innovator in the Israeli payments, and consumer and SME lending sectors,” said Daniel Zilberman, head of Europe and member of the Executive Management Group at Warburg Pincus.

“I am confident that our investment in Leumi Card will be of great benefit to the company’s customers and the State of Israel as a whole. Together, with the talented and very high-quality staff of the company, we will be able to create material benefit for the public in the areas of payments, credit and financing.”


Based in Bnei Brak, Leumi Card has issued more than 2.6 million credit cards and offers merchant acquiring services to over 40,000 businesses.

“Over the past year, we have laid the foundation for our separation from Bank Leumi, signed new operating with additional banks and new funding agreements, and this year we proved our capital raising capabilities in the Israeli market and earned extensive trust in the institutional market,” said Leumi Card CEO Ron Fainaro.

“We face a great and complicated administrative and marketing challenge, but also a great opportunity for the business to expand in directions that the company has been prevented from doing until now. We are no longer just a credit card company. Max will be a leading financial services company based on our advanced payment capabilities.”

Under the Increasing Competition in Banking Law passed by the Knesset in 2016, Bank Leumi and Bank Hapoalim were required to sell the credit card companies under their ownership by January 2020, or reduce their holdings to below 40% if the companies are issued on the stock exchange.

Last month, Bloomberg reported that Bank Hapoalim is considering an initial public offering for its credit card business Isracart, the largest in Israel. The IPO could value the business at approximately $1 billion.

Join Jerusalem Post Premium Plus now for just $5 and upgrade your experience with an ads-free website and exclusive content. Click here>>

Related Content

The backdrop of the stage at last year’s AIPAC conference in Washington, DC
March 26, 2019
Pelosi, Friedman, McConnell address AIPAC on final day - watch live

By JPOST.COM STAFF