Discount Investments makes offer to take control of Bezeq

Discount Investment Corp joined the race to take control of Israel’s largest telecom group, Bezeq, with an offer on Monday to buy its ailing parent company Eurocom for more than NIS1 billion.

Discount, which would have to sell its mobile operator unit Cellcom to win regulatory approval for the deal, will now compete with two other bidders.

A group led by US-Israeli businessman Naty Saidoff made an offer to buy Eurocom in January, and Israeli media has widely reported that another bid that came from a private group that includes Neuman brothers from Israel.

Eurocom’s chairman, Shaul Elovitch, who is being investigated by Israeli authorities for possible fraud and financial reporting offenses, is under pressure to sell Eurocom, which is laden with nearly NIS1 billion in debt. Elovitch has denied any wrongdoing.

Discount said in a statement to the Tel Aviv Stock Exchange it was prepared to pay NIS375 million for smaller units controlled by Eurocom, including Enlight Renewable Energy .

Within the following six months it would inject an additional NIS700 million into Eurocom, which controls Bezeq with a 26% stake, in exchange for bonds that could be converted into Eurocom shares.

During this time, depending on approval by Israel’s antitrust authority, Discount said it would sell its shares in Cellcom.

Discount is a subsidiary of holding company IDB Development Corp, whose controlling shareholder is Argentinian businessman Eduardo Elsztain. (Reuters)