Bezeq Israel Telecom has acquired the 50.2% of local DTH firm YES it does not already own after getting government approval.
Israel Prime Minister Benjamin Netanyahu’s green light for the deal, which Bezeq said in February was worth up to NIS1.05bn…
Bezeq Israel Telecom has acquired the 50.2% of local DTH firm YES it does not already own after getting government approval.
Israel Prime Minister Benjamin Netanyahu’s green light for the deal, which Bezeq said in February was worth up to NIS1.05bn (US$280m), paves the way for a merger that has been years in the making.
It will see the telco buy the shares from Eurocom, a private holding company controlled indirectly by Shaul and Yosef Elovitch, who are also Bezeq’s controlling shareholders.
Competition concerns had led regulators to shoot down Bezeq’s earlier attempt in 2009 to raise its stake to 58%. The move was also opposed at the time by Eurocom, which had yet to take control of Bezeq.
However, regulators said last year that technological improvements since then have made it easier for other players to compete with the combined group. They allowed Bezeq to increase its stake in YES to beyond 49.8% on certain conditions, which include limits on content exclusivity arrangements and the services that the merged group can offer.
Although the government has allowed Bezeq to buy 100% of YES, it wants a separate review to decide whether they can combine their operations structurally.
Bezeq is paying NIS680m (US$182m) in cash for the shares, and could pay up to NIS370m (US$99m) more based on tax synergies and YES’ business performance. It is also acquiring the shareholder loans that Eurocom has provided YES. That debt stood at about NIS1.54bn (US$405m) at the end of 2014.
