Bronfman buys IKEA Israel
USD 140 million price tag higher than thought
The Israeli branch of furniture manufacturer IKEA has been sold to Matthew Bronfman, Globes reported Thursday.
In a departure from normal procedures, the company did not issue a tender for the franchise, settling instead on Bronfman's bid outright.
According to reports, the sale price was approximately USD 140 million, more than USD 100 million higher than the price estimated earlier by Bronfman's Blue Square Co-op.
Other contenders for the Swedish furniture giant's Israeli branch included Alon Israel Fuel CEO (and Bronfman's Blue Square Israel business partner) David Weissman, the Gaon Investment Group, Fuchs fashion chain, and Eliezer Fishman.
For the past two-and-a-half years Blue Square tried unsuccessfully to negotiate a purchase agreement with Ikea International. Two weeks ago, Blue Square representative Lipa Meir initiated moves to issue a tender for Ikea Israel by submitting an initial draft to the Tel Aviv District Court.
Netanya branch successful
Ikea's lone Israeli branch, located in Netanya, has been highly successful. Since opening in 2001, sales have totaled more than NIS 1.1 billion (USD 254 million). 2003 sales were approximately NIS 325 million (USD 75 million), and during the first nine months of 2004 company sales were recorded at approximately NIS 288 million (USD 66.5 million).
The transfer of ownership means Ikea can open another branch in Israel, but no decisions have been made about when or where that will occur.
Ikea is not open on Shabbat. With the transfer to Bronfman, and his ultra-Orthodox partner Shalom Fisher, it is unlikely to open on Shabbat in the future.
