By Sara Toth Stub
JERUSALEM--Scailex Corp (SCIX.TV), the controlling stakeholder
in telecommunication company Partner Communications Co. (PTNR.TV),
said Thursday it's close to selling most of its 44.5% stake in the
cellular carrier to Saban Capital Group Ltd.
"The talks are very advanced and the company thinks that an
agreement will be signed in the coming hours," Scailex said in a
statement.
The Israeli-investment company, which has been holding talks
with Saban since October, didn't disclose how much the U.S. private
investment firm would pay for the stake, but it did say that Saban
would take on $300 million in debt that Scailex owes to Hutchison
Whampoa Ltd. (0013.HK), Partner's former controlling
shareholder.
Scailex bought the stake in Partner for $1.38 billion in 2009.
Hutchison lent Scailex some of the money for the purchase, but the
deal gave Hutchinson the right to reacquire Partner at a later
date. Scailex has been unable to pay off that loan due to a lack of
dividends paid by Partner, and repayment of the loan has been
postponed to 2018. It now has total debts of around $760
million.
Earlier this year, Hutchison almost acquired the controlling
stake in Partner by buying 75% of Scailex from Suny Electronics
Ltd. (SUNY.TV), but it pulled out of the proposed $125 million deal
citing poor financial results at Partner and the increasing
competition in Israel's recently-deregulated cellular sector.
Partner, like all of Israel's mobile communications companies,
has seen lower profits this year due to the deregulation of the
Israeli cellular market. Partner's third quarter net profit
declined 25% to $336 million due to increased competition.
Saban invests in media, entertainment and communications sectors
and is headed by Haim Saban, the television producer best known for
producing Power Rangers.
Partner is the local franchisee of France Telecom's (FTE.FR)
Orange brand.
On Thursday, shares of Scailex closed up 1.66 shekels ($0.44),
or 27%, at ILS7.82, and shares of Partner closed up ILS0.96, or
4.05%, at ILS24.65, in a higher Tel Aviv market.
Write to Sara Toth Stub at realtimedesklondon@dowjones.com
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