Cellcom and Electra Consumer Products announced: The sale of Golan Telecom to Cellcom has been completed

Cellcom and Electra Consumer Products announced on Wednesday that the sale of Golan Telecom to Cellcom has been completed. Electra Consumer Products announced that the parties had agreed that the basic amount of consideration set forth in the Memorandum of Understanding would be reduced by NIS 77 million to NIS 513 million instead of NIS 590 million.
The total amount of consideration for the rights in the Golan will be approximately NIS 648 million: the amount includes the basic consideration as aforesaid; Dividend distributed by Golan on August 23 in the amount of NIS 33 million; The balance of cash in the Golan Fund in the amount of NIS 72 million; And an amount of about NIS 30 million that Cellcom undertook to pay to Golan from the completion of the transaction until the end of the year.
Alcata Consumer Products's share in exchange for the sale in respect of the rights in the Golan (90.01%), without the consideration to Sharon and after full dilution resulting from options granted to Golan employees and for which they were entitled to part of the consideration, stands at a total of NIS 574 million. Amatz is expected to record a pre-tax capital gain of NIS 230-220 million in the third quarter of 2020, when together with the withdrawal of the company's share in Golan's profits from the date of its acquisition in April 2017 until the date of completion of the transaction, including its share in Golan's profits until the end of the second quarter. , The total profit that resulted from the company, due to its investment in the Golan, amounts to a total of about half a billion shekels.
In fact, Amatz's total capital invested in Golan Telecom amounted to NIS 60 million, along with NIS 140 million taken at the time of the purchases taken as a bank loan that had already been repaid, and NIS 130 million taken as a loan from Cellcom, which Golan itself is now repaying. Cellcom, which acquires the company. In total, the capital gain, together with the aforesaid accrued profits, reflects a return of more than nine times (more than 800%) per million in a period of less than three and a half years on its investment in the Golan, and an IRR return of about 90 %.
Following the merger, Cellcom will be the second largest communications group in Israel in terms of revenue. According to the financial reports for 2019, Cellcom and Golan Telecom's revenues stand at NIS 4.2 billion, compared to HOT with NIS 3.8 billion and Partner with NIS 3.2 billion. Golan Telecom's CFO, Shai Amsalem, will serve as acting CEO To Golan, who will serve as a virtual operator for the next three years. Sharon will move to serve as Bezeq's chairman.