Partner Seeks Court Approval to Distribute NIS 500 Million Dividend Despite Limited Surplus

Partner Communications has filed an unusual request with the court to approve a dividend distribution of NIS 500 million, even though its distributable surplus stands at only NIS 75 million. The company plans to finance this payout by raising NIS 750 million in debt, which would increase its leverage significantly after a notable reduction since the controlling group acquired it in 2022. If approved, Partner's net financial debt would rise to approximately NIS 800 million.

The controlling group, Ampisah, includes prominent investors such as Avi Gabay, Shlomo Rodev, Phoenix, Clal, Menora, and the Arkin family. Since the acquisition, the group has reduced Partner's debt, resulting in the lowest leverage in the industry. Currently, Partner is valued at around NIS 7 billion, with the controlling shareholders' holdings worth NIS 750 million more than their investment cost.

While the move could increase the company's risk, the court has previously allowed similar dividend distributions, such as with Bezeq. Approval depends on the court being convinced that the dividend will not jeopardize Partner's ability to repay its creditors. Creditors might oppose the plan, but it is likely that Partner coordinated with them beforehand. Earlier this year, Partner already distributed a dividend of NIS 465 million.

The company supported its request with an expert opinion from Professor Zvi Wiener, who stated that the dividend would not harm Partner's repayment capacity. Partner forecasts its revenues to grow from NIS 3.1 billion in 2025 to NIS 3.7 billion by 2030.