Potential Merger of Investment Houses Yalin Lapidot and IBI Could Create Israel's Largest

The possibility of a merger between Israeli investment houses Yalin Lapidot and IBI is drawing market attention, following an analysis published by Calcalist. Atrao, which holds 50% of Yalin Lapidot Holdings, saw its stock surge 7% on the Tel Aviv Stock Exchange, valuing the company at 950 million shekels. This rise is attributed to Calcalist's analysis suggesting a merger with IBI as Yalin Lapidot's fastest growth path.

Yalin Lapidot has been facing a significant crisis due to client departures in the provident fund sector, losing 18 billion shekels in client assets since mid-2023. As of now, it manages 79 billion shekels in this sector, with 2.2 billion shekels withdrawn in August alone, representing about 3% of its provident fund assets.

IBI, controlled by Dave Lovetzky, Edo Kook, and David Weisberg, has experienced substantial revenue growth in mutual funds, independent trading systems, and a high-tech services company. However, it lacks a provident fund arm. A merger, structured as a stock deal, could create Israel's largest investment house, particularly in mutual funds. Both firms are also leaders in managing investment portfolios for private clients, a sector that has recently gained renewed interest due to the introduction of a new, profitable product in 2024 allowing for indirect investment in hedge funds and profit-sharing with clients.

IBI did not comment on the matter. Yalin Lapidot stated that it "regularly receives inquiries from interested investment entities, similar to other leading investment houses. Currently, no deal is on the table. Even if an investment is advanced in the future, the sale of the entirety of Yair and Dov's shares is not on the table, and any arrangement would include preserving their management status and unique contribution to the company."