Phoenix Investment House Seeks to Sell Alron Stake Over Loan Default
Phoenix Investment House is attempting to sell its controlling shares in the technology investment company Alron after the purchasing entity, Arieli Group, failed to meet the terms of a loan. Arieli Group borrowed 90 million shekels from Phoenix to acquire its 58.4% controlling stake in Alron for $53 million in September 2024. The loan was secured by Arieli's Alron shares, which were valued at the time at twice the loan amount.
Alron's share price has declined 34% since the beginning of the year, impacting Arieli's ability to meet the loan's covenants, specifically the debt-to-equity ratio. Phoenix has demanded that Arieli either repay the loan or inject capital to improve Alron's financial standing. Despite assurances from Arieli over the past two months that they would refinance the loan, this has not occurred.
In the last two weeks, Phoenix has begun offering the pledged Alron shares to institutional and private investors at a discount to the debt. Arieli is reportedly seeking alternative financing of 24.5 million pounds or a 20 million shekel capital injection to reduce the debt and improve the ratio. If these efforts fail, the controlling shares of Alron are likely to be sold at auction.
However, a potential financial solution that would allow Phoenix to recover the full loan amount emerged on the previous day. Arieli Group is a privately held Israeli company owned by Lisia Bachar Manoa (who also chairs Alron), Ariel Bentov, and Yonatan Ratov. Alron, managed by Yaniv Schneider, holds stakes in 17 technology companies, including investments through a joint venture with Rafael.
Alron, a 60-year-old company, has undergone significant changes since Arieli's acquisition, shifting from a passive investor to an active partner. Despite several successful exits, Alron's financial results have been mixed, partly due to its portfolio companies being in early development stages with high cash burn rates. Alron reported a profit of $9.3 million for 2025 and $22.5 million for 2024, following a $8 million loss in 2023.
