Discount Investment Corporation (DIC), the controlling shareholder in Cellcom (News - Alert) Israel, announced that it will be selling approximately 3.3 percent of the company's issued share capital, for a total consideration of NIS 300 million in cash, to a financial institution.

Besides these 3,260,870 shares of the company stock, the agreement with the financial institution contains a clause for the sale of an additional 1,700,000 shares, constituting approximately 1.7 percent of the company's issued share capital, for a total additional sum of approximately NIS 156 million in cash.

Recently, DIC sold 5 percent equity stake in Cellcom Israel for an undisclosed amount.

According to the agreement with the financial institution, in case these shares or part thereof will be sold by the purchaser at a price per share exceeding NIS 92.5 within 72 hours from signing the agreement, the purchaser shall pay DIC an additional consideration equal to 80 percent of the part of the consideration exceeding such price per share for the shares that will be sold in such price.

The purchaser is looking at placing such shares for sale outside the United States to non-US investors. As per the agreement, DIC will not dispose of any of the company's shares owned by it following this sale until August 15, 2011 without the approval from the financial institution.

Following the completion of the transaction, DIC will hold 45 percent stake in Cellcom Israel or if the option is exercised, approximately 43.3 percent stake of the company, according to a press statement issued.

Cellcom Israel provides its 3.395 million subscribers with a broad range of value added services including cellular and landline telephony, roaming services for tourists in Israel and for its subscribers abroad and additional services in the areas of music, video, mobile office etc.

Recently, Cellcom Israel declared a first quarter dividend of NIS 2.93 per share. The company’s total revenues increased 0.4 percent to NIS 1,587 million ($456 million). Total Revenues from services decreased 14.8 percent to NIS 1,205 million ($346 million) as a result of the regulatory changes. Revenues from content and value added services (including SMS) increased 13.5 percent, reaching 23.7 percent of services revenues.

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