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Israel Sets Pension Sale
International
Herald Tribune, June 22, 2004
Israel will be seeking offers starting Tuesday for its sale of three pension funds that have combined assets of about 15 billion shekels, the government's Older Pension Funds Administration said Monday.
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The government will make a special effort to encourage foreign investors to join the bidding, Yair Seroussi, who heads the committee preparing the sale, said at a news conference in Tel Aviv.
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Sales notices will be published Tuesday, and the winners will be announced by Sept. 9.
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"The timing is optimal because of the renewed interest in the Israeli economy," Seroussi said. "It's a unique investment opportunity - a shortcut to the Israeli market and access to many customers."
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The Finance Ministry is using the sale to reduce debt and increase competition in financial markets. Israeli banks, which have operations in underwriting, share brokering and portfolio management, have been barred from making offers.
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Restrictions have also been placed on the country's four biggest insurers.
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The biggest of the three funds for sale is Mivtachim, with assets of 9.9 billion shekels, or $2.2 billion, and 439,000 members as of the end of last year, documents prepared by the pensions administration show. The New Makefet fund had just under 3 billion shekels in assets and 152,000 members, while Meitavit had 1.7 billion shekels in assets and 69,000 members.
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The government last year took over the three pension funds, as well as eight others, from the Histadrut labor federation, accusing the unions of mismanagement.
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The eight funds not being sold have about a 146 billion-shekel actuarial deficit, meaning they have obligations to make payments to members in excess of their projected income.
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Proceeds from the sale will be used to help close the deficit, said the pensions administration, which acts as an umbrella organization for the 11 government-appointed managers now running the funds. The three funds have no deficit.
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Finance Minister Benjamin Netanyahu will speak Tuesday in New York at a conference of the biggest holders of Israeli bonds to encourage foreign investors to take part in the tender, the pension's administration said.
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< < Back to Start of Article Israel will be seeking offers starting Tuesday for its sale of three pension funds that have combined assets of about 15 billion shekels, the government's Older Pension Funds Administration said Monday.
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The government will make a special effort to encourage foreign investors to join the bidding, Yair Seroussi, who heads the committee preparing the sale, said at a news conference in Tel Aviv.
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