Yohananof Restructures Real Estate Assets Into Subsidiary Valued at 1.1 Billion Shekels
Yohananof supermarket chain is restructuring its real estate by transferring 14 properties valued at 1.1 billion shekels to a wholly-owned subsidiary, paving the way for potential future public offerings.
The Yohananof supermarket chain, managed by Eitan Yohananof, is advancing its corporate restructuring by transferring 14 real estate assets valued at approximately 1.1 billion shekels to a wholly-owned subsidiary named L.G.M.L. Kochav Modiin.
Strategic Reorganization of Real Estate Assets
Following the board's approval on August 19, the company signed a detailed agreement to transfer ownership or leasehold rights of 14 properties to the new subsidiary. The total fair value of these assets stands at roughly 1.1 billion shekels, with a depreciated cost of about 1 billion shekels. Yohananof stated that this consolidation aims to streamline real estate management, enhance financial and business flexibility, and allow the capital market to separately evaluate the retail and property operations.
Market Comparison and Tax Structure
Unlike competitors such as Rami Levy, which operates a separate real estate arm, and Shufersal, which consolidated its properties into a subsidiary back in 2013, Yohananof previously integrated its real estate directly within the retail entity. CEO Eitan Yohananof has previously hinted at a potential public offering for the real estate arm. The transfer is structured as a tax-exempt corporate reorganization under income tax and betterment tax laws, subject to reduced purchase tax. The subsidiary will issue shares to Yohananof in exchange for the properties, while existing corporate debts are not transferred.
"The establishment of the subsidiary lays the groundwork in case the chain decides to publicly float its real estate arm on the stock exchange in the future," the company reported.
Future Outlook and Expansion
The transaction is subject to standard technical conditions precedent, including the assignment of rights with project partners. Concurrently, the companies signed long-term market-rate lease agreements for the properties utilized by the retail chain. In 2026, Yohananof engaged in several prominent deals, including purchasing land in Dimona for 30 million shekels, entering partnerships in Binyamina and Beersheba, and initiating residential development projects.
