Mizrahi Tefahot Bank Ltd. entered into an agreement to acquire 75% stake in Union Bank of Israel Ltd. from Yeshayahu Landau Holdings Ltd., Shlomo Eliahu Holding Ltd. and others.
The Board of Directors Mizrahi Tefahot had decided to submit an appeal to the Restrictive Trade Practices Court against the Antitrust Authority's decision to disqualify the merger on the grounds of concern about harm to competition. Mizrahi Tefahot has extended the agreement with the Union Bank shareholders for an additional year, provided that if a judgment is received by the end of the period according to which the appeal has been postponed or no judgment will be given by the end of the period in relation to the appeal, the agreement will be canceled. As of July 8, 2019, the date fixed for the purpose of implementing the preliminary drafts to publish the tender offer is extended to November 30, 2019. As of November 28, 2019, the transaction has been approved by the Israel's antitrust court. As of January 8, 2020, Competition Commissioner established conditions for the merger between the Bank and Union per the Merger Agreement, including a condition regarding the sale of the Bank's or Union's diamond sector credit activities. As of July 14, 2020, the final date for the fulfillment of the conditions for the publication of the purchase offer shall occur on September 30, 2020. Insofar as a judgement is granted up to the Final Publication Date, according to which the appeal submitted to the Competition Tribunal was rejected, or should no judgement be granted with respect to the Appeal, or if the Competition Commissioner's approval for the Credit Transaction is not received, the Merger Agreement shall be cancelled.
On July 27, 2020, the Commissioner's amended decision was received which will allow for the completion of the Credit Portfolio Sale Transaction parallel to the execution of the Merger. The validity of the Tender Offer is contingent, inter alia, upon obtaining the minimum acceptance rate, which will be met where acceptance notices are received from the Offerees referring to at least 69,903,873 Union shares constituting 95% of the Offerees' shares, and more than half of the Offerees who do not have a personal interest in accepting the Exchange Tender Offer have accepted it, or where acceptance notices are received from the Offerees referring to at least 72,111,364 Union shares constituting 98% of Union's issued and paid-up share capital. Shareholders constituting 74.75% stake have accepted the offer. The deal is also subject to permit from the Governor of the Bank of Israel, receiving a permit from the Capital Market, Insurance and Savings Commissioner for change of control in Union's two insurance agencies, anticipated as a result of the execution of the Exchange Tender Offer, receiving preliminary approval (or preliminary approvals) from the Tax Authority. As of January 27, 2020, the deadline for the completion of the conditions for the transaction was postponed to May 31, 2020. The last date for delivering the acceptance notices for the Exchange Tender Offer subject to this Specification is on September 13, 2020. Bank Mizrahi Tefahot Ltd acted as offer coordinator.