Hagag Group Sells Rani Zim Shopping Center Stake for 75 Million Shekels
Hagag Group is selling a 7.5% stake in Rani Zim Shopping Centers back to Rani Zim Holdings for 75 million shekels at a 1 billion shekel valuation, maintaining joint control.
Hagag Group is reducing its stake in Rani Zim Shopping Centers while maintaining a high valuation, signing an agreement to sell 7.5% of the shopping center company's shares back to Rani Zim Holdings for 75 million shekels. The transaction is based on a company valuation of 1 billion shekels, reflecting a premium of about 30% over the market share price.
Financial Impact and Use of Proceeds
Out of the total consideration, 26 million shekels will be allocated to repaying the company's debt, while the remaining balance—approximately 49 million shekels before tax—will remain in Hagag's cash reserves. The company noted that no material impact on its financial results is expected as a result of the sale.
Transaction completion is expected within 30 days, with the buyer granted the right to extend the period by an additional 15 days. As of the signing date, the sold shares are pledged to a financing entity to secure the company's obligations.
Joint Control and Future Options
Following the sale, Hagag Group's holding through a subsidiary in Rani Zim Shopping Centers will decrease to approximately 22.16%, representing about 39.5 million shares. Despite the reduction in ownership percentage, the parties signed an amendment to the shareholders' agreement ensuring that joint control by Hagag Group and the Zim Group will continue.
"We strive to make transactions that unlock value. All of them unlock value—both in Rani Zim and in Adi Zim's urban renewal projects. In the end, we make good acquisitions and the market loves them," Tzahi Hagag recently stated.
Under this framework, each party will retain equal entitlement to nominate directors, and preliminary meeting decisions will continue to be made unanimously. Additionally, Hagag granted the Zim Group an option to purchase an additional 7.5% of the shares within 11 months from the transaction completion date.
