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JERUSALEM, Dec. 30 (Reuters) – Israel intends to fully privatize its national postal service by combining a share offer in Tel Aviv and other measures, including a possible sale to a private entity.
Communications Minister Yoaz Hendel said 40% of Israel Post Co would be sold in an initial public offering on the stock exchange and the rest of the state’s shares would be sold through a private sale, an IPO or a combination of the two.
The outline has been approved by the Israeli finance minister, but no timetable has been announced.
After years of poor performance, Israel Post has undergone a major reorganization, including changing its range of delivery centers and downsizing.
The government has said it hopes taking part of the private company will further improve operations.
Hendel said he had proposed reforms, including reducing regulation, expanding competition in letter-writing, advancing the transition to digitization, changing the method of mailing. price controls and higher fines for violation of licensing provisions.
“The courier market is fading as the parcel market grows,” he said. “It’s time for the postal service to undergo a change.”
Only a complete privatization of the postal company is a long-term solution to the structural problems of the postal company, he said.
A 2018 partial privatization plan, including a 20% sale to a strategic investor and later a 20% IPO, was not enough, the ministry said. As long as the state retains control, it will have to keep injecting hundreds of millions of shekels every few years, he said.
In the first half of 2021, Israel Post lost 64 million shekels ($ 21 million) from a loss of 163 million a year earlier. In 2020, he lost NIS 643 million – in part due to a one-time charge – against a profit of NIS 29 million in 2019.
($ 1 = NIS 3.1103)
Reporting by Steven Scheer; Editing by Emelia Sithole-Matarise
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