approved: Phoenix's to purchase the investment house The board of directors of Hellman Aldubi for NIS 275 million

The board of directors of Hellman Aldubi decided yesterday to approve Phoenix's offer to purchase the investment house for NIS 275 million. Following the acquisition, Hellman Aldubi will be wiped out of trading, and he and his managed assets will be swallowed up inside the Phoenix.
Hellman Aldubi manages financial assets worth NIS 62 billion - NIS 40 billion of which is the IEC's pension money, on which a meager management fee of only NIS 7 million is paid per year. The balance of the assets is the core of the investment house, which includes a selected pension fund (which manages NIS 3 billion), provident funds, mutual funds, portfolio management and three insurance agencies.
The controlling owner (48%) of Hellman Aldubi is Hellman Aldubi Finance, which is owned by Roni Hellman (12.5%), Uri Aldobi (12.5%), Isaac Seton (16.99%), Peter Friedman (24.9%), Dora Jezreel (14.2%) and David Israel (14.2%). Friedman provided the company with an owner loan of NIS 100 million. Following the transaction, Hellman Aldubi Finance will receive NIS 132 million, but after deducting the loan, the remaining shareholders will have only NIS 32 million.
Since the IPO in 2017 until the announcement of the takeover bid, Hellman Aldubi shares have lost 37%
Hellman Aldubi began trading on the stock exchange in 2017 at a value of NIS 137 million. From the time of the IPO to the publication of the takeover bid, the investment house's stock has lost 37%. That is, just before the takeover bid, Hellman Aldubi is traded at a meager value of only NIS 95 million. For this reason, quite a few minority shareholders have been looking for ways to realize their holdings in profit. The deal with the Phoenix will lead to the person who bought the company in an IPO three years ago recording a nice return of 100% on the investment.
The Phoenix is ​​staring mainly at the provident assets of Hellman Aldubi - worth NIS 22 billion. These assets, after deducting commissions to agents, generate revenues of NIS 90 million per year. From such income the Phoenix may generate a profit. The assimilation of the provident assets in Phoenix will allow CEO Eyal Ben-Simon to approach the profit targets he presented in the company's strategic business plan recently.
 Hellman Aldubi manages a selected pension fund (formerly a default fund), whose assets amount to NIS 2.6 billion. Selected pension funds are currently enjoying rapid growth, and the potential is probably huge. For example, Altshuler Shaham, who is also the manager of a selected pension fund, has consistently taken a bite out of some insurance companies, and in a short period of time has managed to significantly increase the volume of assets under management, to NIS 8.3 billion.
Hellman Aldubi was elected to manage a selected pension fund in 2016, as part of a reform of the Ministry of Finance designed to increase competition in the pension market. The market is currently controlled by two players - Menora Mivtachim and Harel (+ 0.74% 2851). The Capital Market, Insurance and Savings Authority also set another goal - a reduction in management fees for many employees, who paid maximum management fees. In recent years, management fees throughout the market have indeed decreased. The next tender for the selected funds is expected to take place in about a year and a half.
The cyber attack on the Shirbit company revealed the weakness of cyber defenses in small companies, which of course does not harm the regulators' considerations in approving the merger. "It can be assumed that Hellman Aldubi's customers will be more protected in terms of cyber when they are in Phoenix. In the end, the large companies invest quite a bit in cyber protection, NIS 15-20 million a year. These are amounts that smaller companies do not necessarily have," said a senior executive.