dec 25, 1996 - Turbowicz: Direct Insurance, Leumi should have separate boards
Description:
Turbowicz: Direct Insurance, Leumi should have separate boards
The Jerusalem Post
December 25, 1996, Wednesday
Copyright 1996 The Jerusalem Post
Section: ECONOMICS; Pg. 8
Length: 248 words
Byline: Galit Lipkis Beck
Body
ANTITRUST Authority director-general Dr. Yoram Turbowicz intends to subject Bank Leumi's prospective purchase of 20 percent of Direct Insurance to a number of conditions, intended to maintain market competition and prevent conflicts of interest, a Ministry if Industry and Trade source said yesterday.
Bank Leumi is in advanced negotiations to purchase Direct Insurance from its parent company, Zur Shamir Holdings, in the framework of Bank Leumi's diversification strategy.
Direct Insurance markets insurance policies directly to customers.
Following the companies' announcement of the proposed transaction approximately two months ago, Turbowicz launched an inquiry into the implications of the sale, according to sources.
Turbowicz is mainly concerned that Bank Leumi's control of 20% of Israeli insurance leader Migdal, and its purchase of Direct Insurance, the leading company in the direct insurance market, would hinder market competition.
Migdal controls about 25% of the local insurance sector, while Direct Insurance controls about 5% of the market.
Among others, Turbowicz intends to subject the transaction to total separation of Bank Leumi's and Direct Insurance's managements, including a prohibition to employ any director on both boards.
Bank Leumi said there is no legal reason for Turbowicz to object to the transaction.
"In our opinion the transaction will go ahead. We don't see any problem," said a Bank Leumi spokesperson.
Added to timeline:
יורם טורבוביץ'
Date:
