US buyout giant Warburg Pincus has decided to bring in a trio of strategic partners amid completing its ILS2.5bn $690m purchase of Israel-based credit card services provider Leumi Card.
Menorah Mivtachim, Clal Insurance & Finance and Allied Group will all hold 5 per cent of the company’s shares, with Menorah and Clal increasing their holdings to 10 per cent each once regulatory approvals have been received.
Warburg said it saw great importance in including key Israeli partners in the investment, which it agreed last July in a buyout from Bank Leumi and the Azrieli Group.
Leumi Card is set to rebrand to Max following the deal being completed.
Warburg head of Europe Daniel Zilberman said, “Our investment in Leumi Card reflects the tremendous trust and respect that we have for the Israeli economy, its people and the considerable developing opportunity in the country’s financial service sector.
“Leumi Card is an excellent business that we hope to bring our global expertise to, and help build a true leader and innovator in the Israeli payments, and consumer and SME lending sectors.”
Leumi Card CEO Ron Fainaro added, “We are the first credit card company in Israel to embark on a new and independent journey.
“We are prepared and ready to implement our strategic plans, and intend to expand our lending business for individuals and businesses and to invest in new growth areas.
“Over the past year, we have laid the foundation for our separation from Bank Leumi, signed new operating with additional banks and new funding agreements, and this year we proved our capital raising capabilities in the Israeli market and earned extensive trust in the institutional market.”
Warburg has made a number of investments in Israel, including Cyren, Ness Technologies and Alliance Tire Company.
The firm closed its first dedicated fund for financial services on $2.3bn at the end of 2017.
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