UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D/A
(Amendment No. 2)
Under the Securities Exchange Act of 1934
Partner Communications Company Ltd.
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(Name of Issuer)
Ordinary Shares
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(Title of Class of Securities)
70211M109
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(CUSIP Number)
Paul Weinberg, Adv.
Elron Electronic Industries Ltd.
The Triangular Tower, 42nd Floor
3 Azrieli Center, Tel Aviv 67023
Israel
Tel: +972 3 6075555
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(Name, Address and Telephone Number of Person Authorized to
Receive Notices and Communications)
February, 7, 2005
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(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition that is the subject of this Schedule 13D, and is filing this
schedule because of ss.ss.240.13d-1(e), 240.13d-1(f) or 249.13d-1(g), check the
following box. [_]
NOTE: Schedules filed in paper format shall include a signed original and five
copies of the schedule, including all exhibits. See ss.240.13d-7 for other
parties to whom copies are to be sent.
* The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
SCHEDULE 13D
CUSIP NO. 70211M109
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1. Names of Reporting Persons.
I.R.S. Identification Nos. of above persons (entities only)
Elbit Ltd.
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2. Check the Appropriate Box if a Member of a Group (See Instructions)
(a) [X]
(b) [_]
--------------------------------------------------------------------------------
3. SEC Use only
--------------------------------------------------------------------------------
4. Source of funds (See Instructions)
Not Applicable
--------------------------------------------------------------------------------
5. Check if disclosure of Legal Proceedings Is Required Pursuant to Items 2(d)
or 2(e) [_]
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6. Citizenship or Place of Organization
Israel
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7. Sole Voting Power
0
Number of -------------------------------------------------------------
Shares 8. Shared Voting Power
Beneficially 15,856,551(*)
Owned by -------------------------------------------------------------
Each Reporting 9. Sole Dispositive Power
Person 0
With: -------------------------------------------------------------
10. Shared Dispositive Power
15,856,551(*)
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11 Aggregate Amount Beneficially Owned by Each Reporting Person
15,856,551(*)
--------------------------------------------------------------------------------
12. Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See
Instructions) [_]
--------------------------------------------------------------------------------
13. Percent of Class Represented by Amount in Row (11)
8.6%
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14. Type of Reporting Person (See Instructions)
CO
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(*) This excludes additional shares of the Issuer that the Reporting Persons may
be deemed to beneficially hold as a result of agreements entered into with other
shareholders of Issuer regarding, among other things, the disposition of the
Reporting Persons' shares of Issuer as described in Items 4-6.
Page 2 of 55 pages
SCHEDULE 13D
CUSIP NO. 70211M109
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1. Names of Reporting Persons.
I.R.S. Identification Nos. of above persons (entities only)
Elron Electronic Industries Ltd.
--------------------------------------------------------------------------------
2. Check the Appropriate Box if a Member of a Group (See Instructions)
(a) [X]
(b) [_]
--------------------------------------------------------------------------------
3. SEC Use only
--------------------------------------------------------------------------------
4. Source of funds (See Instructions)
Not Applicable
--------------------------------------------------------------------------------
5. Check if disclosure of Legal Proceedings Is Required Pursuant to Items 2(d)
or 2(e) [_]
--------------------------------------------------------------------------------
6. Citizenship or Place of Organization
Israel
--------------------------------------------------------------------------------
7. Sole Voting Power
0
Number of -------------------------------------------------------------
Shares 8. Shared Voting Power
Beneficially 15,856,551(*)
Owned by -------------------------------------------------------------
Each Reporting 9. Sole Dispositive Power
Person 0
With: -------------------------------------------------------------
10. Shared Dispositive Power
15,856,551(*)
--------------------------------------------------------------------------------
11 Aggregate Amount Beneficially Owned by Each Reporting Person
15,856,551(*)
--------------------------------------------------------------------------------
12. Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See
Instructions) [_]
--------------------------------------------------------------------------------
13. Percent of Class Represented by Amount in Row (11)
8.6%
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14. Type of Reporting Person (See Instructions)
CO
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(*)This excludes additional shares of the Issuer that the Reporting Persons may
be deemed to beneficially hold as a result of agreements entered into with other
shareholders of Issuer regarding, among other things, the disposition of the
Reporting Persons' shares of Issuer as described in Items 4-6.
Page 3 of 55 pages
SCHEDULE 13D
CUSIP NO. 70211M109
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1. Names of Reporting Persons.
I.R.S. Identification Nos. of above persons (entities only)
Discount Investment Corporation Ltd.
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2. Check the Appropriate Box if a Member of a Group (See Instructions)
(a) [X]
(b) [_]
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3. SEC Use only
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4. Source of funds (See Instructions)
Not Applicable
--------------------------------------------------------------------------------
5. Check if disclosure of Legal Proceedings Is Required Pursuant to Items 2(d)
or 2(e) [X]
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6. Citizenship or Place of Organization
Israel
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7. Sole Voting Power
0
Number of -------------------------------------------------------------
Shares 8. Shared Voting Power
Beneficially 15,856,551(*)
Owned by -------------------------------------------------------------
Each Reporting 9. Sole Dispositive Power
Person 0
With: -------------------------------------------------------------
10. Shared Dispositive Power
15,856,551(*)
--------------------------------------------------------------------------------
11 Aggregate Amount Beneficially Owned by Each Reporting Person
15,856,551(*)
--------------------------------------------------------------------------------
12. Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See
Instructions) [_]
--------------------------------------------------------------------------------
13. Percent of Class Represented by Amount in Row (11)
8.6%
--------------------------------------------------------------------------------
14. Type of Reporting Person (See Instructions)
CO
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(*)This excludes additional shares of the Issuer that the Reporting Persons may
be deemed to beneficially hold as a result of agreements entered into with other
shareholders of Issuer regarding, among other things, the disposition of the
Reporting Persons' shares of Issuer as described in Items 4-6.
Page 4 of 55 pages
SCHEDULE 13D
CUSIP NO. 70211M109
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1. Names of Reporting Persons.
I.R.S. Identification Nos. of above persons (entities only)
IDB Development Corporation Ltd.
--------------------------------------------------------------------------------
2. Check the Appropriate Box if a Member of a Group (See Instructions)
(a) [X]
(b) [_]
--------------------------------------------------------------------------------
3. SEC Use only
--------------------------------------------------------------------------------
4. Source of funds (See Instructions)
Not Applicable
--------------------------------------------------------------------------------
5. Check if disclosure of Legal Proceedings Is Required Pursuant to Items 2(d)
or 2(e) [_]
--------------------------------------------------------------------------------
6. Citizenship or Place of Organization
Israel
--------------------------------------------------------------------------------
7. Sole Voting Power
0
Number of -------------------------------------------------------------
Shares 8. Shared Voting Power
Beneficially 15,856,551(*)
Owned by -------------------------------------------------------------
Each Reporting 9. Sole Dispositive Power
Person 0
With: -------------------------------------------------------------
10. Shared Dispositive Power
15,856,551(*)
--------------------------------------------------------------------------------
11 Aggregate Amount Beneficially Owned by Each Reporting Person
15,856,551(*)
--------------------------------------------------------------------------------
12. Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See
Instructions) [_]
--------------------------------------------------------------------------------
13. Percent of Class Represented by Amount in Row (11)
8.6%
--------------------------------------------------------------------------------
14. Type of Reporting Person (See Instructions)
CO
--------------------------------------------------------------------------------
(*)This excludes additional shares of the Issuer that the Reporting Persons may
be deemed to beneficially hold as a result of agreements entered into with other
shareholders of Issuer regarding, among other things, the disposition of the
Reporting Persons' shares of Issuer as described in Items 4-6.
Page 5 of 55 pages
SCHEDULE 13D
CUSIP NO. 70211M109
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1. Names of Reporting Persons.
I.R.S. Identification Nos. of above persons (entities only)
IDB Holding Corporation Ltd.
--------------------------------------------------------------------------------
2. Check the Appropriate Box if a Member of a Group (See Instructions)
(a) [X]
(b) [_]
--------------------------------------------------------------------------------
3. SEC Use only
--------------------------------------------------------------------------------
4. Source of funds (See Instructions)
Not Applicable
--------------------------------------------------------------------------------
5. Check if disclosure of Legal Proceedings Is Required Pursuant to Items 2(d)
or 2(e) [_]
--------------------------------------------------------------------------------
6. Citizenship or Place of Organization
Israel
--------------------------------------------------------------------------------
7. Sole Voting Power
0
Number of -------------------------------------------------------------
Shares 8. Shared Voting Power
Beneficially 15,856,551(*)
Owned by -------------------------------------------------------------
Each Reporting 9. Sole Dispositive Power
Person 0
With: -------------------------------------------------------------
10. Shared Dispositive Power
15,856,551(*)
--------------------------------------------------------------------------------
11 Aggregate Amount Beneficially Owned by Each Reporting Person
15,856,551(*)
--------------------------------------------------------------------------------
12. Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See
Instructions) [_]
--------------------------------------------------------------------------------
13. Percent of Class Represented by Amount in Row (11)
8.6%
--------------------------------------------------------------------------------
14. Type of Reporting Person (See Instructions)
CO
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(*)This excludes additional shares of the Issuer that the Reporting Persons may
be deemed to beneficially hold as a result of agreements entered into with other
shareholders of Issuer regarding, among other things, the disposition of the
Reporting Persons' shares of Issuer as described in Items 4-6.
Page 6 of 55 pages
SCHEDULE 13D
CUSIP NO. 70211M109
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1. Names of Reporting Persons.
I.R.S. Identification Nos. of above persons (entities only)
Nochi Dankner
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2. Check the Appropriate Box if a Member of a Group (See Instructions)
(a) [X]
(b) [_]
--------------------------------------------------------------------------------
3. SEC Use only
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4. Source of funds (See Instructions)
Not Applicable
--------------------------------------------------------------------------------
5. Check if disclosure of Legal Proceedings Is Required Pursuant to Items 2(d)
or 2(e) [_]
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6. Citizenship or Place of Organization
Israel
--------------------------------------------------------------------------------
7. Sole Voting Power
0
Number of -------------------------------------------------------------
Shares 8. Shared Voting Power
Beneficially 15,856,551(*)
Owned by -------------------------------------------------------------
Each Reporting 9. Sole Dispositive Power
Person 0
With: -------------------------------------------------------------
10. Shared Dispositive Power
15,856,551(*)
--------------------------------------------------------------------------------
11 Aggregate Amount Beneficially Owned by Each Reporting Person
15,856,551(*)
--------------------------------------------------------------------------------
12. Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See
Instructions) [_]
--------------------------------------------------------------------------------
13. Percent of Class Represented by Amount in Row (11)
8.6%
--------------------------------------------------------------------------------
14. Type of Reporting Person (See Instructions)
IN
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(*)This excludes additional shares of the Issuer that the Reporting Persons may
be deemed to beneficially hold as a result of agreements entered into with other
shareholders of Issuer regarding, among other things, the disposition of the
Reporting Persons' shares of Issuer as described in Items 4-6.
Page 7 of 55 pages
SCHEDULE 13D
CUSIP NO. 70211M109
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1. Names of Reporting Persons.
I.R.S. Identification Nos. of above persons (entities only)
Shelly Bergman
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2. Check the Appropriate Box if a Member of a Group (See Instructions)
(a) [X]
(b) [_]
--------------------------------------------------------------------------------
3. SEC Use only
--------------------------------------------------------------------------------
4. Source of funds (See Instructions)
Not Applicable
--------------------------------------------------------------------------------
5. Check if disclosure of Legal Proceedings Is Required Pursuant to Items 2(d)
or 2(e) [_]
--------------------------------------------------------------------------------
6. Citizenship or Place of Organization
Israel
--------------------------------------------------------------------------------
7. Sole Voting Power
0
Number of -------------------------------------------------------------
Shares 8. Shared Voting Power
Beneficially 15,856,551(*)
Owned by -------------------------------------------------------------
Each Reporting 9. Sole Dispositive Power
Person 0
With: -------------------------------------------------------------
10. Shared Dispositive Power
15,856,551(*)
--------------------------------------------------------------------------------
11 Aggregate Amount Beneficially Owned by Each Reporting Person
15,856,551(*)
--------------------------------------------------------------------------------
12. Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See
Instructions) [_]
--------------------------------------------------------------------------------
13. Percent of Class Represented by Amount in Row (11)
8.6%
--------------------------------------------------------------------------------
14. Type of Reporting Person (See Instructions)
IN
--------------------------------------------------------------------------------
(*)This excludes additional shares of the Issuer that the Reporting Persons may
be deemed to beneficially hold as a result of agreements entered into with other
shareholders of Issuer regarding, among other things, the disposition of the
Reporting Persons' shares of Issuer as described in Items 4-6.
Page 8 of 55 pages
SCHEDULE 13D
CUSIP NO. 70211M109
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1. Names of Reporting Persons.
I.R.S. Identification Nos. of above persons (entities only)
Ruth Manor
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2. Check the Appropriate Box if a Member of a Group (See Instructions)
(a) [X]
(b) [_]
--------------------------------------------------------------------------------
3. SEC Use only
--------------------------------------------------------------------------------
4. Source of funds (See Instructions)
Not Applicable
--------------------------------------------------------------------------------
5. Check if disclosure of Legal Proceedings Is Required Pursuant to Items 2(d)
or 2(e) [_]
--------------------------------------------------------------------------------
6. Citizenship or Place of Organization
Israel
--------------------------------------------------------------------------------
7. Sole Voting Power
0
Number of -------------------------------------------------------------
Shares 8. Shared Voting Power
Beneficially 15,856,551(*)
Owned by -------------------------------------------------------------
Each Reporting 9. Sole Dispositive Power
Person 0
With: -------------------------------------------------------------
10. Shared Dispositive Power
15,856,551(*)
--------------------------------------------------------------------------------
11 Aggregate Amount Beneficially Owned by Each Reporting Person
15,856,551(*)
--------------------------------------------------------------------------------
12. Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See
Instructions) [_]
--------------------------------------------------------------------------------
13. Percent of Class Represented by Amount in Row (11)
8.6%
--------------------------------------------------------------------------------
14. Type of Reporting Person (See Instructions)
IN
--------------------------------------------------------------------------------
(*)This excludes additional shares of the Issuer that the Reporting Persons may
be deemed to beneficially hold as a result of agreements entered into with other
shareholders of Issuer regarding, among other things, the disposition of the
Reporting Persons' shares of Issuer as described in Items 4-6.
Page 9 of 55 pages
SCHEDULE 13D
CUSIP NO. 70211M109
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1. Names of Reporting Persons.
I.R.S. Identification Nos. of above persons (entities only)
Avraham Livnat
--------------------------------------------------------------------------------
2. Check the Appropriate Box if a Member of a Group (See Instructions)
(a) [X]
(b) [_]
--------------------------------------------------------------------------------
3. SEC Use only
--------------------------------------------------------------------------------
4. Source of funds (See Instructions)
Not Applicable
--------------------------------------------------------------------------------
5. Check if disclosure of Legal Proceedings Is Required Pursuant to Items 2(d)
or 2(e) [_]
--------------------------------------------------------------------------------
6. Citizenship or Place of Organization
Israel
--------------------------------------------------------------------------------
7. Sole Voting Power
0
Number of -------------------------------------------------------------
Shares 8. Shared Voting Power
Beneficially 15,856,551(*)
Owned by -------------------------------------------------------------
Each Reporting 9. Sole Dispositive Power
Person 0
With: -------------------------------------------------------------
10. Shared Dispositive Power
15,856,551(*)
--------------------------------------------------------------------------------
11 Aggregate Amount Beneficially Owned by Each Reporting Person
15,856,551(*)
--------------------------------------------------------------------------------
12. Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See
Instructions) [_]
--------------------------------------------------------------------------------
13. Percent of Class Represented by Amount in Row (11)
8.6%
--------------------------------------------------------------------------------
14. Type of Reporting Person (See Instructions)
IN
--------------------------------------------------------------------------------
(*)This excludes additional shares of the Issuer that the Reporting Persons may
be deemed to beneficially hold as a result of agreements entered into with other
shareholders of Issuer regarding, among other things, the disposition of the
Reporting Persons' shares of Issuer as described in Items 4-6.
Page 10 of 55 pages
This Amendment No.2 on Schedule 13D amends the Statement on Schedule 13D, as
amended, previously filed with the Securities and Exchange Commission by the
Reporting Persons ("Original Filing") with respect to the Ordinary Shares, par
value New Israeli Shekel 0.01 per share, of Partner Communications Company Ltd.
("Issuer"). This Amendment No. 2 on Schedule 13D/A (the "Amendment") supplements
and amends the Original Filing to the extent specified herein. Capitalized terms
used but not defined in this Amendment have the meanings given to them in the
Original Filing.
The following amends and supplements Items 2, 4, 5, 6 and 7 of the Original
Filing.
ITEM 2. IDENTITY AND BACKGROUND.
(a), (b) and (c): The Reporting Persons.
The address of DIC's principal office is the Triangular Tower, 44th Floor,
3 Azrieli Center, Tel Aviv 67023, Israel.
The address of Nochi Dankner is the Triangular Tower, 44th Floor, 3 Azrieli
Center, Tel Aviv 67023, Israel. His present principal occupation is businessman,
the chairman and chief executive officer of IDB Holding and chairman of IDB
Development, DIC and Clal Industries and Investments Ltd., an Israeli public
corporation with its principal office at the Triangular Tower, 45th Floor, 3
Azrieli Center, Tel Aviv 67023, Israel, which is a subsidiary of IDB
Development.
As of February 7, 2005:
DIC owned approximately 45.7% of the outstanding shares of Elron.
IDB Development owned approximately 67.3% of the outstanding shares of DIC.
IDB Holding owned approximately 62.3% of the outstanding shares of IDB
Development.
Nochi Dankner (together with a private company controlled by him) and Shelly
Bergman owned approximately 47.1% and 13.4% respectively of the outstanding
shares of, and control, Ganden Holdings. Pursuant to an Investment and
Shareholders Agreement dated February 9, 2000, as amended, among Ganden Holdings
and all its shareholders, Nochi Dankner has an option exercisable from time to
time until February 15, 2005 to acquire from Ganden Holdings shares constituting
in the aggregate up to 9% of the outstanding shares of such corporation at the
time this option will be exercised for the last time. Also, Nochi Dankner
granted to three of Ganden Holdings' other shareholders, owning in the aggregate
approximately 11.9% of Ganden Holdings' outstanding shares, a tag along right to
participate in certain sales of Ganden Holdings' shares by Nochi Dankner, and
one of such shareholders agreed to vote all its shares of Ganden Holdings,
constituting approximately 1.8% of Ganden Holdings' outstanding shares, in
accordance with Nochi Dankner's instructions.
In addition to approximately 31.02% of the outstanding shares of IDB Holding
owned by Ganden, which is controlled by Nochi Dankner and Shelly Bergman through
Ganden Holdings, Ganden Holdings owned approximately 6.4% of the outstanding
shares of IDB Holding, and a private Israeli corporation which is wholly owned
by Shelly Bergman owned approximately 7.2% of the outstanding shares of IDB
Holding.
Page 11 of 55 pages
In addition to approximately 10.34% of the outstanding shares of IDB Holding
owned by Manor, which is controlled by Ruth Manor, another private Israeli
corporation which is controlled by her owned approximately 0.03% of the
outstanding shares of IDB Holding.
In addition to approximately 10.34% of the outstanding shares of IDB Holding
owned by Livnat, which is controlled by Avraham Livnat, another private Israeli
corporation which is controlled by him owned approximately 0.04% of the
outstanding shares of IDB Holding.
The name, citizenship, residence or business address and present principal
occupation of the directors and executive officers of (i) Elbit, (ii) Elron,
(iii) DIC, (iv) IDB Development and (v) IDB Holding are set forth in Schedules
A, B, C, D and E attached hereto, respectively, and incorporated herein by
reference. These Schedules replace Schedules A, B, C, D and E previously
attached to the Original Filing.
(d) None of the Reporting Persons or, to the knowledge of the Reporting
Persons, any director or executive officer named in Schedules A, B, C, D and E
to this Amendment, has, during the last five years, been convicted in any
criminal proceeding, excluding traffic violations and similar misdemeanors,
except as provided below.
In November 2004, the Tel Aviv District Court acquitted DIC, several past
executive officers of DIC and one of its other officers, and accepted their
appeal filed in such Court against a judgment of Tel Aviv Magistrate's Court
convicting them in February 2002, of criminal offenses under the Israeli
Securities Act,1968, regarding the inclusion of a misleading detail in DIC's
annual and quarterly financial statements in order to mislead a reasonable
investor by not attaching the financial statements of certain companies to DIC's
financial statements in respect of the financial reporting periods from 1990
through the first quarter of 1995 filed with the Tel Aviv Stock Exchange and the
Israeli Registrar of Companies. In December 2004, the prosecution filed in the
Supreme Court of Israel a request for leave to appeal against the aforesaid
decision of the Tel Aviv District Court. This request of the prosecution has not
yet been heard by the Supreme Court. None of the activities underlying the legal
proceedings described above, which activities ended in May 1995, relate to or
involve the Issuer or its business in any way.
(e) None of the Reporting Persons or, to the knowledge of the Reporting
Persons, any director or executive officer named in Schedules A, B, C, D and E
to this Amendment, has, during the last five years, been a party to a civil
proceeding of a judicial or administrative body of competent jurisdiction which
as a result of such proceeding was or is subject to a judgment, decree or final
order enjoining future violations of, or prohibiting or mandating activities
subject to, Federal or state securities laws or finding any violation with
respect to such laws.
ITEM 4. PURPOSE OF THE TRANSACTION.
On February 7, 2005, Elbit Limited ("Elbit"), Polar Communications Ltd.
("Polar") and Eurocom Communications Ltd. ("Eurocom"), offered to sell all of
their Ordinary Shares to the Issuer (the "Buyback") and granted Matav
Investments Ltd. ("Matav") an option to participate in the Buyback. On the same
date, such shareholders entered in an agreement with Hutchison
Telecommunications (Netherlands) B.V. ("Hutchison BV") that, among other things,
sets forth terms and conditions for the sale of Ordinary Shares by such
shareholders in the event that the Buyback does not occur under certain
circumstances (the "Alternative Agreement"). The Buyback and the Alternative
Agreement are summarized in Item 6 below.
Page 12 of 55 pages
The purpose of such transactions is to enable these shareholders to realize
their respective investments in the Issuer, which were made upon the founding of
the Issuer in 1997. The sale of shares by such shareholders is restricted by the
terms of Issuer's license (the "License") issued by the Israeli Ministry of
Communications, which has recently expressed its willingness to relax such
restrictions.
Except as set forth in Item 6 below, none of the Reporting Persons, nor, to
the best of their knowledge, any of their respective directors or executive
officers, has any present plans or proposals which relate to or would result in
any of the actions described in subsections (a) through (j) of Item 4 of the
Schedule 13D rules.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
(a) As of February 7, 2005, Elbit is the beneficial owner of an aggregate
of 15,856,551 Ordinary Shares of Issuer, representing approximately 8.6% of the
issued and outstanding Ordinary Shares as of January 19, 2005 (a total of
184,086,340 Ordinary Shares, based on information provided by the Issuer). As of
February 7, 2005, Elron owned all the outstanding shares of Elbit, and is
therefore the beneficial owner of the Ordinary Shares owned directly by Elbit,
and shares with the Reporting Persons the power to vote and dispose of the
Ordinary Shares owned directly by Elbit. DIC, IDB Development, IDB Holding and
the Reporting Persons who are natural persons may be deemed beneficial owners
of, and to share the power to vote and dispose of, these Ordinary Shares. In
addition, each of the Reporting Persons may be deemed beneficial owner of, and
to share the power to vote and dispose of the Ordinary Shares owned by the other
principal shareholders of the Issuer as a result of the Relationship Agreement
described in Item 6 of the Original Filing. Each of the Reporting Persons
disclaims such beneficial ownership.
As a result of the Buyback offer and the Alternative Agreement, the
Reporting Persons through Elbit, together with Eurocom, Polar and Matav (who are
filing a separate statement on Schedule 13D), are deemed to have formed a group
for the purpose of disposing Ordinary Shares (the "Group"). Accordingly, each
member of the Group may be deemed to beneficially own the Ordinary Shares of the
other members of the Group, for an aggregate of 41,386,575 Ordinary Shares,
constituting approximately 22.5% of the outstanding Ordinary Shares. Each member
of the Group disclaims beneficial ownership of the Ordinary Shares held by any
other member. As of January 19, 2005, there were 184,086,340 Ordinary Shares
outstanding, based on information provided by the Issuer.
(b) Each member of the Group may be deemed to share the power to dispose of
all of the Ordinary Shares of the Group. Each member of the Group holds Ordinary
Shares and has sole voting power in respect of the Ordinary Shares held by it
(except as described in Item 6 below), as follows:
Page 13 of 55 pages
Number of Ordinary Shares Percentage of Outstanding
Name Held Ordinary Shares
----------------- ---------- ----------
Reporting Persons 15,856,551 8.6%
Eurocom 11,626,616 6.3%
Polar 4,235,038 2.3%
Matav 9,668,370 5.3%
Total 41,386,575 22.5%
(c) Information provided to the Reporting Persons indicates that the
executive officers and directors of IDB Holding, IDB Development, DIC, Elron and
Elbit did not own as of February 7, 2005 any Ordinary Shares (including Ordinary
Shares that may be acquired pursuant to options to purchase such shares from the
Issuer) except as described in Schedules A and B hereto. On January 25, 2005,
444 Ordinary Shares were purchased on behalf of Tal Raz on the Tel Aviv Stock
Exchange at a price per share of NIS35.84 ($8.14 according to the applicable
exchange rate of NIS 4.405 per $1.00). According to the information provided to
the Reporting Persons, and except as set forth above, none of such executive
officers and directors purchased or sold any Ordinary Shares during the last 60
days prior to February 7, 2005:
(d) Not applicable.
(e) Not applicable.
ITEM 6. CONTRACTS, ARRANGEMENTS OR RELATIONSHIPS WITH RESPECT TO SECURITIES OF
THE ISSUER.
BUYBACK
On February 7, 2005, Elbit, Polar, and Eurocom offered to sell to the
Issuer, severally and not jointly, an aggregate of 31,718,205 Ordinary Shares,
representing all of their Ordinary Shares, for aggregate consideration of
between NIS 984.6 million ($225.2 million) and NIS 1.02 billion ($233.6 million)
(the "Buyback Offer"). Matav has the option to participate in the Buyback. In
the event that Matav exercises this option, the Buyback would increase to an
aggregate of 33,317,932 Ordinary Shares (and the aggregate purchase price would
increase accordingly), which would be allocated among the selling shareholders
pursuant to their respective ownership of Ordinary Shares. If Matav does not
exercise its option to participate in the Buyback, then for a period of 90 days
following the closing of the Buyback, Matav will have an option to sell an
aggregate of 5,755,974 Ordinary Shares to Elbit, Eurocom and Polar, severally
and not jointly, at the price paid by the Issuer in the Buyback, plus interest,
in the respective proportions that would have resulted had Matav participated in
the Buyback. Matav has the right to transfer to its lending banks (namely, Bank
Hapoalim, Bank Leumi, Bank Discount and First International Bank of Israel) the
foregoing options, along with the underlying Ordinary Shares
The Buyback is subject to various conditions, including:
- the consent of the Issuer's lending banks in respect of their pledge
on the Ordinary Shares of the selling shareholders;
- the receipt of financing by the Issuer;
Page 14 of 55 pages
- the approval of the Issuer's audit committee, board of directors and
shareholders;
- the consent of the Israeli Ministry of Communications; and
- the approval of the Israeli Antitrust Authorities of the increase of
the holding in the Issuer by Hutchison Telecommunications
International Ltd. and its affiliates to more than 50% as a result of
the Buyback.
The sale price formula of the Buyback reflects a 10% discount from the
20-trading day volume weighted average market price of the Ordinary Shares on
the Tel Aviv Stock Exchange prior to the meeting of the Issuer's shareholders in
which the Buyback is approved, up to a maximum price of NIS 32.22 per share
($7.37 based on the applicable exchange rate of NIS 4.372 per $1.00) but not
below NIS 31.04 per share ($7.10 based on such exchange rate). The closing price
of the Ordinary Shares on the Tel Aviv Stock Exchange on February 27, 2005, was
NIS 39.41 per share.
The offer letter provides that the Buyback offer will terminate on the date
that any of the following occur: (i) on or before 21 days from the date of the
Buyback offer, the Issuer shall have failed to (A) accept the Buyback offer
following the approval of its Audit Committee and Board of Directors or (B)
publish a notice convening a shareholder meeting to approve the Buyback
scheduled for a date within 51 days from the date of the Buyback offer,
provided, that if the Issuer shall not yet have received the required approvals
of the Israeli Ministry of Communications and its lending banks for the
financing of the Buyback, then the Issuer shall be entitled to defer the
publication of such shareholder meeting notice to a date no later than 41 days
from the date of the Buyback offer and to defer the scheduled date of such
meeting to no later than 71 days from the date of the Buyback offer; (ii) the
Issuer shall have announced the cancellation of such shareholder meeting or its
postponement to a date later than 51 days from the date of the Buyback offer (or
71 days, if applicable); (iii) the shareholders of the Issuer shall have failed
to duly approve the Buyback at the shareholder meeting convened for such
purpose; or (iv) at the election of the selling shareholders, the Buyback shall
not have closed within 80 days from the date of the Buyback offer, provided they
are not in material breach of the provisions of the Buyback offer.
On February 24, 2005, the Issuer announced that its board of Directors had
approved acceptance of the Buyback offer. The Buyback offer is still subject to
the receipt of regulatory consents and approval of the Issuer's shareholders.
ALTERNATIVE AGREEMENT
On February 7, 2005, Elbit, Eurocom, Polar and Matav (the "Israeli
Shareholders") also entered into an agreement with Hutchison BV relating to the
sale of Ordinary Shares if the Buyback fails to be consummated in certain
circumstances, including: (i) any directors of the Issuer nominated by Hutchison
or an affiliate thereof vote against the Buyback at the applicable meeting of
the Board of Directors; (ii) the failure of the Issuer to obtain a commitment
for financing of the Buyback within 41 days; (iii) the failure of the Issuer to
publish a notice within 41 days calling for a shareholders meeting for the
purpose of approving the Buyback, subject to certain exceptions; (iv) Hutchison
BV or an affiliate thereof fails to vote in favor of the Buyback in the Issuer's
shareholders meeting to be convened for the purpose of approving the Buyback;
(v) the cancellation or postponement of such shareholders meeting; or (vi) or
the failure of the Issuer's shareholders to approve the Buyback at such
shareholders meeting. The date of occurrence of any of the foregoing is referred
to as the "Effective Date"; provided, however, that despite the occurrence of
any of the foregoing, the Israeli Shareholders are entitled to deem the
Effective Date not to have occurred.
Page 15 of 55 pages
The Alternative Agreement contemplates three types of sale transactions,
subject to applicable conditions similar to those of the Buyback Offer, other
than the receipt of financing and corporate approvals of the Issuer:
(A) From the Effective Date, Israeli Shareholders will be entitled to
sell as a group, pro rata based upon their respective ownership percentages
of Ordinary Shares, in one or more transactions, up to an aggregate of
approximately 9.71% of the Ordinary Shares outstanding on the applicable
sale dates, to any third parties at a price per share not lower than 90% of
the market price of the Ordinary Shares at that time, but not otherwise.
The number of Ordinary Shares permitted to be sold by each Israeli
Shareholder would vary depending on whether or not Matav exercises its
option to participate in such sale.
(B) From the Effective Date, for a period of ten business days, the
Israeli Shareholders, pro rata based upon their respective ownership
percentages of Ordinary Shares, would grant to Hutchison BV a call option
to purchase from them, severally and not jointly, an aggregate of 2% of the
outstanding Ordinary Shares. Each Israeli Shareholder's percentage of the
Ordinary Shares that is subject to the call option would vary depending on
whether or not Matav exercises its option to participate in such
transaction. The exercise price of the 2% call option equals a 12% discount
from the market price of the Ordinary Shares at the time, subject to
adjustment in Hutchison BV's favor based on the price of sales made
pursuant to Clause (C) below. For so long as no Ordinary Shares are sold by
any Israeli Shareholders pursuant to Clause (C) below, then, within six
months from the closing of the call option transaction, Hutchison BV would
have the right to sell back the Ordinary Shares purchased pursuant to the
call option to the respective Israeli Shareholders, at the price equal to
the purchase price paid by Hutchison BV, plus interest.
(C) Following the sale of all the Ordinary Shares permitted to be sold
pursuant to clause (A) above, if any of the Israeli Shareholders seek to
sell, in one or more transactions, any additional Ordinary Shares up to
5.48% of the outstanding Ordinary Shares (or 7.48%, if Hutchison BV did not
exercise its 2% call option), Hutchison BV will have a right of first
refusal to purchase such Ordinary Shares at a 12% discount from the market
price of the Ordinary Shares at that time. If Hutchison BV does not
exercise such right in full, the Israeli Shareholders will be entitled,
during the next 90 days, to sell the unexercised portion of such Ordinary
Shares to any third parties in one or more transactions, provided that the
price per share for each sale is not be less than the price offered to
Hutchison BV. Each Israeli Shareholder's percentage of the Ordinary Shares
that is subject to the right of first refusal would vary depending on
whether or not Matav exercises its option to participate in such sale.
The Israeli Shareholder undertook to ensure that if Hutchison would
exercise all its options to purchase Ordinary Shares pursuant to Clauses (B) and
(C) above, it would hold more than 50% of the outstanding Ordinary Shares.
Matav has the option to participate in the sales described in Clauses (A),
(B) and (C) above, in whole but not in part. In addition, Elbit, Eurocom and
Polar granted Matav a 90-day option entitling Matav to sell such number of
Ordinary Shares to Elbit, Eurocom and Polar, severally and not jointly, pro rata
based upon their respective ownership percentages of Ordinary Shares, that would
cause all the Israeli Shareholders to be in the same position had Matav elected
initially to participate in the sales of Ordinary Shares under the Alternative
Arrangement. If Matav exercises such option, it would become subject to the
options granted to Hutchison BV described above. In the event that Matav does
not exercise such option, then Matav will be solely responsible for maintaining
the minimum percentage of Ordinary Shares required under the terms of the
License to be held by Israeli shareholders. Matav has the right to transfer to
its lending banks (namely, Bank Hapoalim, Bank Leumi, Bank Discount and First
International Bank of Israel) the foregoing options, along with the underlying
Ordinary Shares.
Page 16 of 55 pages
In addition, the parties to the Alternative Arrangement agreed to amend the
Relationship Agreement upon the earlier to occur of (a) the closing of the
Buyback and (b) the closing in full of Hutchison BV's option described in Clause
(B) above or the expiration thereof unexercised. Such amendment would result in,
among other things, the termination of the voting provisions of the Relationship
Agreement. In addition, the parties agreed to amend the Relationship Agreement
from time to time to reflect changes in the restrictions on the Issuer's
founding shareholders under the License.
Upon the closing of the Buyback or of the sales of all the Ordinary Shares
pursuant to Clause (A) above, the nominees of the Israeli Shareholders will
resign from the Issuer's Board of Directors, subject to any applicable
requirements under applicable law or the License.
Finally, each party to the Alternative Arrangement undertook to vote all
their Ordinary Shares in favor of the Buyback at the Issuer's shareholders
meeting to be called for such purpose.
RELATIONSHIP AGREEMENT
As described above under "Alternative Arrangement," the voting provisions
of the Relationship Agreement will terminate upon the earlier to occur of (a)
the closing of the Buyback and (b) the closing in full of Hutchison BV's option
described in Clause (B) under "Alternative Arrangement" or the expiration
thereof unexercised.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS
Schedules A, Name, citizenship, residence or business address and present principal
B, C, D and - occupation of the directors and executive officers of (i) Elbit, (ii) Elron, (iii)
E DIC, (iv) IDB Development and (v) IDB Holding.
Exhibit 1 Irrevocable Offer Letter dated February 7, 2005 setting forth the terms of the
Buyback Offer.
Exhibit 2 Agreement dated February 7, 2005 by and between Elbit Limited, Polar
Communications Ltd.and Eurocom Communications Ltd., Matav Investments
and Hutchison Telecommunications (Netherlands) B.V. setting forth the terms
of the Alternative Arrangement.
Page 17 of 55 pages
SIGNATURE
After reasonable inquiry and to the best of our knowledge and belief, the
undersigned certify that the information set forth in this Amendment on Schedule
13D is true, complete and correct.
Date: March 1, 2005
ELBIT LTD.
ELRON ELECTRONIC INDUSTRIES LTD.
DISCOUNT INVESTMENT CORPORATION LTD.
IDB DEVELOPMENT CORPORATION LTD.
IDB HOLDING CORPORATION LTD.
NOCHI DANKNER
SHELLY BERGMAN
RUTH MANOR
AVRAHAM LIVNAT
BY: IDB HOLDING CORPORATION LTD.
(signed)
BY: ______________________________
Haim Tabouch and Arthur Caplan, authorized signatories of
IDB Holding Corporation Ltd., for itself and on behalf of
Elbit Ltd., Elron Electronic Industries Ltd., Discount
Investment Corporation Ltd., IDB Development Corporation
Ltd., Nochi Dankner, Shelly Bergman, Ruth Manor and Avraham
Livnat, pursuant to agreements annexed to the Original
Filing as Exhibits 5 through 12.
Page 18 of 55 pages