Sale of Psagot Investment House completed

Roy Vermus to challenge removal from CEO post; Psagot will pay NIS 150 million fine in exchange for no indictment being filed.

Apax Partners closed the acquisition of the controlling interest in Psagot Investment House Ltd. from York Capital Management LLC on Friday afternoon for NIS 2.75 billion.
The price is basically the same as the parties had agreed before the negotiations fell apart and were recently renewed.
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Apax Israel CEO Zehavit Cohen agreed to the deal after Psagot reached a plea bargain with the Tel Aviv Prosecutor’s Office and the Israel Securities Authority on Thursday night. Apax will take over Psagot this week.
Last week, Apax held advanced negotiations with the Tel Aviv Prosecutor’s Office, in collaboration with the ISA, for a plea bargain to be reached in the Psagot affair. York was not involved in these negotiations, but they were held with its knowledge and apparent silent acquiescence by York executives in New York.
Under the plea bargain, which Globes outlined several weeks ago, Psagot will pay a fine of NIS 150 million in exchange for no indictment being filed against it.
York’s Israeli representative, Jeremy Blank, strongly denied in the two days before the deal that any negotiations with Apax were taking place. He claimed that Cohen had first approached him on Thursday night.
To close the deal after the negotiations were broken off last week, Cohen bypassed Blank because they were no longer on talking terms. Cohen concluded that Blank’s conduct and stubbornness were obstacles to a deal for Psagot, so she approached York Capital’s executives in New York.
Psagot CEO Roy Vermus may appeal to the High Court of Justice within a few days against his removal from his post following Apax’s takeover of the company.
His ouster is part of the plea bargain.
Officially, Vermus’s aides said he had not yet received the plea-bargain documents, and that he would make his decision only after studying all the details. They said, however, that he was determined that any plea bargain will not include his being legally liable.
“Vermus is not a party to the plea bargain,” his attorney, Nir Cohen said. “The plea bargain is not with his consent and he opposes it. In any event, it is clear that he is not bound by the plea bargain.
The plea bargain was reached when Vermus’s position was not yet presented to the prosecutor, with all that that implies. The issue relating to his continuing to serve at Psagot is therefore surprising.
The details of the full plea bargain have not yet been delivered to Vermus, and after he receives them, he will formulate his position toward the plea bargain and his next steps.”