Cellcom Explores Acquisition of Apple Distributor iCon Group

Cellcom is reportedly in preliminary discussions to acquire a controlling stake in iCon Group, the Israeli importer and distributor of Apple products and owner of the iDigital retail chain. The talks are in their very early stages, with no agreements yet reached on the deal's structure or price. This potential acquisition signals Cellcom's possible expansion strategy under CEO Eli Adadi, following two years focused on improving profitability and reducing its financial debt.

Adadi, who took over as CEO in August 2024, has overseen significant financial improvements at Cellcom. The company's net financial debt has decreased to approximately NIS 1.1 billion by the end of the second quarter of 2026, down from about NIS 1.82 billion two years prior. Cellcom also reported a net profit of NIS 92 million in Q2 2026, a 44% increase year-over-year and its highest quarterly profit in 11 years. This improved financial standing, coupled with reduced financing expenses, enables Cellcom to consider strategic investments and acquisitions.

The potential acquisition aligns with Cellcom's existing retail operations through its subsidiary, Dynamica, one of Israel's largest device retail networks with around 50 branches. Dynamica sells smartphones, computers, tablets, and other electronics, generating approximately NIS 1.1 billion in revenue from device sales in 2025. The device sector has become a significant profit driver for Cellcom, with Q2 2026 mobile and fixed-line device sales reaching about NIS 339 million, a 17% increase. For Adadi, who has experience in this sector from his time at Dynamica, acquiring iCon Group could expand operations in both direct-to-consumer sales and wholesale distribution.

iCon Group, controlled by the private equity fund Sky, has a market capitalization of around NIS 374 million on the Tel Aviv Stock Exchange. Sky holds approximately 42.5% of its shares. In 2025, iCon Group reported revenues of about NIS 1.62 billion and a net profit of NIS 41.1 million. Industry estimates suggest a potential acquisition could value iCon Group at NIS 450-500 million, though this is a preliminary assessment. The final price will depend on the stake acquired and the deal structure.

The acquisition would require approval from the Israel Competition Authority, as both companies operate in overlapping markets, particularly in the sale of mobile phones and computers. The merger could enhance the combined entity's purchasing power and create advantages in logistics, distribution, and retail. However, it will also be scrutinized for its impact on competition with other retailers like KSP and other importers and distributors.