Altshuler Shaham Sale Sparks Wave of M&A in Israeli Finance Sector
Translated & summarized from Calcalist by baba
The sale of Altshuler Shaham has triggered a wave of potential mergers and acquisitions in Israel's financial sector, as companies like Yelin Lapidot and IBI explore strategic deals to enhance their market positions and long-term savings operations.
The story in 5 lines · by baba
- Altshuler Shaham sale signals a new wave of M&A in Israel's finance industry.
- Established investment houses with founder control are primary targets.
- Yelin Lapidot is reportedly seeking a NIS 3.3 billion valuation for sale.
- IBI Investment House aims to re-enter long-term savings via acquisition.
- Mor Investment House also seeks a merger to become industry leader.
The recent acquisition of a controlling stake in the financial services firm Altshuler Shaham by Weשור and Yair Levinstein is being viewed not as an end, but as the beginning of a significant merger and acquisition trend within Israel's financial industry. Industry players are reportedly re-evaluating potential acquisitions and mergers to strengthen their market positions, with a particular focus on established investment houses where founders still hold significant control and management roles.
The Altshuler Shaham deal serves as a stark reminder that even market leaders can face rapid shifts in momentum. Just five years ago, Altshuler Shaham's provident fund was the largest in Israel, valued at NIS 4.4 billion. It was recently sold for NIS 1.8 billion after a period of underperforming returns and the departure of its key investment figures. This underscores a critical lesson for veteran founders, especially those without a clear succession plan: even a company at its peak is vulnerable to changing market dynamics.
Investment house Yelin Lapidot is among those reportedly exploring a sale. Founders Yair Lapidot and Dov Yellin are said to be open to offers, seeking a valuation of NIS 3 billion plus NIS 300 million in cash, totaling NIS 3.3 billion. This figure is considerably higher than the company's current market valuation, which is estimated at NIS 2 billion based on its public holding company, Atarاو. Yelin Lapidot has experienced significant outflows of funds, totaling NIS 18 billion since May of last year, with NIS 2.2 billion in net withdrawals in August alone, mirroring the challenges faced by Altshuler Shaham.
IBI Investment House, a major player in mutual funds and brokerage, is also looking to expand into long-term savings, an area it previously exited. IBI had reportedly considered merging with Altshuler Shaham but favored a deal that would allow founder Gilad Altshuler to exit completely. Yelin Lapidot's structure, with founders potentially remaining in management roles, might be a more suitable option for IBI, which has seen its stock price surge significantly.
Meanwhile, Mor Investment House, which has experienced rapid growth in its provident fund, is also reportedly seeking a merger to become the largest investment house in the sector. This indicates that mergers are not solely for companies facing difficulties or founders seeking retirement, but also a strategic move for strong performers aiming for market dominance.