Mizrahi-Tefahot Bank, Israel’s third largest bank by assets, has agreed to acquire smaller rival Union Bank of Israel in all-share transaction worth NIS1.4bn ($400m).
Under the arrangement, Mizrahi-Tefahot will acquire a 75% stake from Yeshayahu Landau and Shlomo Eliyahu Holdings- the controlling shareholders of Union Bank. Mizrahi-Tefahot also intends to acquire the remaining holding through an offer to the public.
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The deal is subject to regulatory nod. Mizrahi-Tefahot is also looking to working out an efficiency arrangement with Union employees.
“This merger is bad for the workers and bad for the public and only serves the interest of the strongest tycoons in the economy, who control the public’s money,” the Union Bank workers committee said.
Union Bank has more than 30 branches and employs more than 1,200 staff. Mizrahi-Tefahot has 185 branches across Israel, including 46 branches of its subsidiary Bank Yahav, and managed $67.89bn in assets at the end of September 2017.
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