Cal sale likely to be postponed after Horesh-Harel cancel deal

The government is favorably considering postponing Israel Discount Bank's requirement to sell its stake in Cal-Israel Credit Cards, after Union Group and Harel insurance withdrew from the acquisition deal due to Competition Authority conditions. Discount Bank will receive NIS 135 million in compensation for its 72% stake, and First International Bank will receive NIS 52 million for its 28% stake. The postponement requires dual approval from the Supervisor of Banks and the Ministry of Finance.

The government is favorably considering postponing Israel Discount Bank's requirement to sell its stake in Cal-Israel Credit Cards, following the collapse of the planned acquisition by Union Group (owned by George Horesh) and Harel Insurance. The buyers withdrew from the deal due to conditions imposed by the Israel Competition Authority, specifically the demand that Union Group sell the Super-Pharm chain. Horesh and Harel prefer to pay NIS 187 million in cancellation compensation rather than accede to that demand. Israel Discount Bank will receive NIS 135 million for its 72% stake, and First International Bank will receive NIS 52 million for its 28% stake. The postponement requires dual approval from the Supervisor of Banks at the Bank of Israel and the Ministry of Finance. Discount Bank had indicated its intention to request a delay last week, though no formal request has been submitted. Sources familiar with the details told Globes that holding Discount Bank to the original May 2027 deadline would be unreasonable, and that an extension would be favorably considered subject to conditions. Factors to be examined include the time elapsed since the sales process opened and the fact that the deal was delayed for nearly a year due to the Competition Authority's review. Market sources believe the Authority's hurdles were effectively intended to push for a Cal IPO, and that any deal would face similar difficulties. Public criticism has arisen over transferring credit card companies from banks to insurance companies, shifting control rather than creating market alternatives.