International and Israeli investors have agreed to acquire up to 21.5% of Phoenix Holdings (TLV: PHOE), a leading Israeli financial group, from Centerbridge Partners and Gallatin Point.
The investments involved an agreement for the sale of 4.95% of Phoenix shares to Affinity Partners, while an additional ~6.5% of the shares will be executed in off-market blocks to various international institutional investors, including Lazard Asset Management. Affinity Partners has further committed to acquiring an additional 4.95% of Phoenix subject to receipt of regulatory approval. All transactions were at a price of NIS 37.50 per share.
Concurrently, various arrangements between the funds and Delek are being closed out. This includes paying off a loan agreement stemming from the 2019 acquisition of the controlling stake from Delek. As part of this process, Delek will also acquire a 4.99% stake in Phoenix at the agreed rate of NIS 37.50 per share.
Centerbridge and Gallatin Point, who acquired control of Phoenix in 2019, will remain with approximately 10.0% after effectuating these transactions.
For the past 70 years Phoenix insurance has positioned itself as one of the most trusted brands in financial services in Israel, currently with over $130 billion USD under management. The firms were impressed with the Phoenix’s reach within Israel, servicing half of the adult Israeli population, and delivering 15% ROE and 19% assets under management compound annual growth over the past 5 years. As Israel continues to grow in both population and GDP, with excellent management and investment partners, Phoenix will remain as one of the leading Israeli financial service companies.
Phoenix will continue under the current management, led by Eyal Ben Simon as CEO, Benny Gabbay as Chairman and other leading international and Israeli directors. The funds, in accordance with their holding permit, will transition their affiliated directors off the board in the coming months. Ben Simon and Gabbay have recently personally invested in the Phoenix and they, along with other management team members, expect to increase their holdings in the future.
Ben Langworthy (Centerbridge) and Lee Sachs (Gallatin): “The management team and employees of the Phoenix are among the best in the industry. We have been proud to work alongside them as they transformed Phoenix into one of the nation’s leading financial institutions. We are excited that these transactions will further diversify the shareholder base of Phoenix. These transactions represent a significant vote of confidence in Phoenix and Israel, and the company’s excellent work over the past several years. We look forward to continuing to support the management team as they lead Phoenix to even greater heights.”
Jared Kushner (Affinity): “We are excited to become significant shareholders in Phoenix. Affinity is long-term bullish on Israel because it is one of the fastest growing countries in the OECD, both in terms of population and GDP growth. We look forward to working closely with the company as it continues its journey toward becoming a globally recognized financial services provider.”
Eyal Ben Simon and Benny Gabbay (Phoenix): “Today signifies a significant milestone for Phoenix. Alongside Centerbridge and Gallatin, we have laid the strategic groundwork that has shaped Phoenix into a leading financial group in Israel, attracting interest from top international investors. We look forward to continuing to develop and grow the company, bringing it to new heights for the benefit of all our shareholders.”
Jefferies acted as sole global coordinator, bookrunner and financial advisor to Centerbridge and Gallatin Point on the transaction. Fischer (FBC & Co.) and White & Case LLP acted as legal counsel to the sellers. Gornitzky and McDermott Will & Emery acted as legal counsel to Affinity. Mizrahi Tefahot Bank Ltd. acted as lender to Centerbridge and Gallatin in their original share purchase as well as agent in connection with this transaction.
About Phoenix Holdings
Phoenix Holdings is a leading Israel-based financial group traded on the Tel Aviv Stock Exchange (TLV:PHOE). With roughly $130 billion in assets under management, Phoenix manages financial activities including asset management, insurance, distribution, and credit. Phoenix has demonstrated strong growth, earnings, and resilience across the cycle, and serves a significant portion of Israeli households with a broad set of financial solutions.
About Centerbridge
Centerbridge Partners, L.P. is a private investment management firm employing a flexible approach across investment disciplines — Private Equity, Private Credit and Real Estate — in an effort to develop the most attractive opportunities for our investors. The Firm was founded in 2005 and, as of December 31, 2023, has approximately $38 billion in capital under management with offices in New York and London. Centerbridge is dedicated to partnering with world-class management teams across targeted industry sectors and geographies. For more information, please visit www.centerbridge.com.
About Gallatin Point
Gallatin Point Capital LLC is a private investment firm with a primary focus on making opportunistic investments in financial institutions, services, and assets. Gallatin Point aims to form highly collaborative partnerships with its investors and with management teams of its portfolio companies, seeking to combine the right capital with the right managerial competencies in order to maximize the outcome for all stakeholders. More information about Gallatin Point can be found at www.gallatinpoint.com.
About Affinity Partners
Affinity Partners is a global investment company headquartered in Miami, managing assets of over $3B USD. Affinity Partners invests globally in leading companies with first class management teams and strong prospects for long term growth.
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