Excellence Nessuah, majoriy-owned by the Phoenix group, has announced the acquisition of Clal Finance's structured notes.
The expanding investment house, with total takings of ILS7m ($1.86m) from its structured products since the beginning of 2011, and with a net profit of ILS2m ($0.53m), has agreed to purchase the Galileo structured note series, comprising two notes linked to the Israeli base rate, with investments amounting to ILS180m ($0.5m). Excellence will also acquire the note series Gilboa dollar, Eden dollar and Glila, with a total investment amount of ILS2.08bn ($534.87m). In return for all four series, Excellence will pay Clal Finance ILS8.5m ($2.26m).
The move follows the struggles in the institutional structured products market since 2010, when the Israel securities authority implemented stricter regulation on notes issuance.
The acquisition will make Excellence the leading institutional structured products provider in Israel, also taking into account last year's purchase of the Shacharit series and the Xpert Series from the Xpert Financial group, worth ILS487m ($129.72m).
In 2008, two of Excellence's structured notes, Keshet and Cochav Olam, which had Lehman Brothers as the deposit taker, returned 79.3% of the initial capital and 54.87% respectively, leading to a number of class-action suits against Excellence.