New York Developer Ashkenazy Said to Bid on Clal Insurance Stake

  • IDBD said it has received offer valuing Clal at $743 million
  • Ashkenazy real estate holdings valued at about $10 billion

New York real estate developer Ashkenazy Acquisition Corp. offered to buy a controlling stake in Clal Insurance Enterprises Holdings Ltd., a unit of distressed Israeli conglomerate IDB Development Ltd., according to two people familiar with the matter.

IDBD said Thursday it received a non-binding offer that values the insurer at 2.85 billion shekels ($743 million), without identifying the bidder. Michael Alpert, the president of Ashkenazy, declined to comment on whether the company made an offer. IDBD declined to comment on the potential buyer’s identity. The people familiar with the matter asked not to be identified because the information is private.

Argentine businessman Eduardo Elsztain, whose real estate investment company IRSA Inversiones y Representactiones SA controls the Tel Aviv-based conglomerate, has been trying to sell Clal to reduce the company’s debt load after he invested $515 million in IDBD. IRSA shares plummeted in November when short seller Spruce Point Capital said IRSA was exposing investors to $6.7 billion in bankruptcy claims from creditors of IDBD.

The offer for Clal includes two options: a cash bid for 25 percent to 30 percent of the insurer’s issued shares, or the purchase of IDBD’s entire stake in the insurer, according to the statement. The new offer isn’t subject to due diligence, and the bidder doesn’t need external financing. IDBD also noted the deal is subject to obtaining a control permit for Clal from Israel’s Commissioner of Capital Markets, Insurance and Savings.

Elsztain’s talks to sell Clal to China’s Macrolink Holding Company Ltd. collapsed in January because of concern that Israeli regulators wouldn’t issue the company a permit.

Ashkenazy Acquisition, which owns properties on Madison Avenue in Manhattan and Boston’s Faneuil Hall Marketplace, controls 100 buildings valued at about $10 billion, according to its website.

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