Clal Insurance Enterprises, a subsidiary of IDB Holding, controlled by Nochi Dankner, has signed an agreement with National Indemnity Company, a subsidiary of Berkshire Hathaway, controlled by Warren Buffet, for the sale of wholly-owned subsidiary Clal US Holdings for $221m.
Clal US Holdings, which owns Guard Insurance Group said that the deal has been inked on $221m cash and the release of a $48m guarantee provided by Clal Insurance to secure a loan to Clal US Holdings from a foreign bank.
Clal Insurance CEO Shy Talmon said five years ago, Clal Insurance invested $107m in Guard, and it is now selling the company for $221m.
"We see interest by a well-known buyer such as Berkshire Hathaway as proof of our success in managing Guard. Clal will now focus on building its business in Israel," Talmon added.
Guard Insurance’s core business markets insurance policies in the US covering workers’ severance pay, said the underwriter.
In May 2007, Clal Insurance acquired Guard for $112m and until today pumped $155m in Guard, as reported by the insurer.
As per the deal, the sale of Guard to National Indemnity Company is scheduled to complete within a few months, after getting US regulatory approval.