Beinleumi And CAL: The Value Exists, but Realization Is Still Stuck in Timing and Deal Structure

The main article already argued that Beinleumi entered 2026 with profitability normalizing, clean capital, and room for capital return. This follow-up isolates the CAL layer because that is exactly where the gap opens between obvious accounting value and realization that is still not closed. The bank carries CAL on its balance sheet at NIS 874 million, has joined a signed sale process, and has already disclosed potential sale gains. Even so, as of March 10, 2026, both timing and final economics are still moving.

What works here is not guesswork but the numbers already on the page. What weighs on the story is that this is not a fully self-directed monetization process that Beinleumi controls end to end. It is a join-up to a transaction that began with Discount's control sale. So the right way to read CAL inside Beinleumi is through three separate layers: the value already sitting on the books, the new value that could be created if the sale closes, and the pieces that are still open in timing, approvals, and consideration mechanics.

• This is not a forced sale for Beinleumi. The regulatory obligation to sell applies to Discount as the controlling shareholder, while Beinleumi is allowed to keep a non-controlling holding in CAL.
• Most of the value is already on the balance sheet. Beinleumi's CAL investment stands at NIS 874 million, so not every shekel of sale proceeds would be new value for shareholders.
• 2025 distorted CAL's earnings contribution. The bank's share of CAL profit before tax fell to NIS 33.4 million from NIS 87.9 million, mainly because of one-off items at CAL.
• The extension does not resolve the uncertainty. It extends it. The long-stop date moved to April 19, 2026, but the immediate report leaves room for the process, in theory, to stretch as far as November 1, 2026 if every extension right is used.

2025 depressed the earnings, not necessarily the value

The first number that can mislead the reader is the annual profit line. Beinleumi holds 28.2% of CAL's equity and 21.0% of its voting rights, and the carrying amount of the investment stood at NIS 874 million at year-end 2025. In that same year, the bank's share of CAL profit, before tax, fell to just NIS 33.4 million, down 62.0% versus 2024. Stop there, and it is easy to conclude that CAL is no longer a meaningful asset. That would be wrong.

The decline in 2025 was not framed as ordinary operating erosion. It was framed as the result of two one-off items. The first was a NIS 137 million expense, net of tax, tied to the VAT assessment court ruling. The second was a NIS 75 million expense, net of tax, from the revaluation of a phantom option granted to El Al, based on an updated estimate that relied, among other things, on the sale agreement. In other words, 2025 did not just reduce CAL's contribution to Beinleumi. It also mixed legal noise and deal-structure revaluation noise into the same annual earnings line.

That chart is the center of the gap. CAL earned NIS 450 million in 2023, NIS 301 million in 2024, and only NIS 129 million in 2025. That does not mean the asset disappeared. It means the latest year was already marked up by unusual items before the deal closed. So 2025 is a poor base for a superficial read of value, but a useful base for understanding the problem: Beinleumi still holds a valuable asset, while reported earnings from that asset were unusually compressed.

This matters for what comes next as well. If the sale closes, Beinleumi will not only monetize CAL. It will also stop carrying the volatility of equity-accounted earnings from CAL. On the other hand, it will also give up future earnings contribution from the associate. The monetization is therefore not a one-way benefit. It removes one layer of noise, but it also removes an earnings engine that was worth much more in stronger years.

What is actually new for shareholders if the sale closes

The biggest reading mistake in the CAL story is to take the headline deal value as if all of it were fresh value for Beinleumi shareholders. The filings themselves point to a much more disciplined read. On one side, the terms published by Discount imply up to NIS 2.873 billion for the sale of 71.8% of CAL's equity rights, including about NIS 2.694 billion of immediate consideration and up to NIS 180 million of contingent consideration. On the other side, Beinleumi already carries CAL on its own balance sheet at NIS 874 million.

Using the 71.83%/28.17% split disclosed for Discount and the bank, Beinleumi's gross economics imply roughly NIS 1.06 billion of immediate consideration and roughly NIS 1.13 billion if the full contingent consideration is paid. But that is still not the most important number. The numbers that matter most are the ones the bank itself disclosed as expected sale gains: up to about NIS 132 million of immediate net gain after tax on closing, plus up to about NIS 52 million of additional net gain after tax later, depending on the contingent consideration.

That waterfall shows why CAL is both a real asset and an optical illusion. Most of the value is already inside the numbers. What is actually new for shareholders, in terms of value above what was already carried on the books, is not more than NIS 1 billion. It is at most about NIS 184 million net, and even that only if the sale closes and the contingent consideration is paid in full. The rest is mainly the conversion of an investment already carried under the equity method into cash at the bank level.

That leads directly to the accessible-value question. The sale can indeed turn a balance-sheet investment treated under the equity method into real cash at the bank level. That is meaningful. But the documents in hand quantify the sale gain, not a dedicated shareholder-distribution route tied to the transaction. The cleaner way to read this is therefore as the conversion of accounting value into a more liquid asset, and only partly as new value creation.

Why realization is still stuck in timing

To understand why CAL remains an uncertainty overhang even after the bank announced it had joined the transaction, it helps to start with what Beinleumi does not have to do. Under the July 2024 amendment to the Banking Law, Discount must sell control of CAL within the stated timetable, but there is no prohibition on Beinleumi holding CAL at a non-controlling level. So Beinleumi is not selling because regulation forced it out. It is selling because it was given tag-along rights into Discount's deal and chose to exercise them.

That distinction matters because it also explains the structure of control over the process. On September 21, 2025, the bank received the tag-along notice. On November 19, 2025, it announced that it had exercised that right. If the deal closes, the bank's stake will be purchased by Union only, not by both buyers together. In other words, Beinleumi is not running an independent monetization process with a buyer of its own choosing. It is joining a control sale already built around the main selling shareholder.

That is where timing becomes central. The agreement originally set a long-stop date six months from signing, with the option under certain conditions to extend by about another four and a half months. On March 10, 2026, the bank reported that Discount had sent the buyers a notice extending the deadline by 30 days, to April 19, 2026. The same report added that beyond that point, the parties can extend by another three and a half months, subject in the buyers' case to certain conditions, and that Discount can then extend for another 90 days. That is how the theoretical outer date moves all the way to November 1, 2026.

This is not just a calendar issue. Every delay leaves several variables open at once: the control and holding permit from the Supervisor of Banks, antitrust approval, third-party consents, and the running update of the bank's share in CAL's profits up to the quarter near closing. So the extension is not a technicality. It extends the period in which the market knows the value is there, but still does not know exactly when, or at what final number, it will land.

And the consideration is not truly fixed either

Even if timing is set aside for a moment, the consideration itself is not one hard number. The immediate component is defined at about NIS 2.694 billion, fully in cash, but it is adjusted for dividends and certain deal expenses. On top of that, once six months have passed from signing, it starts to accrue interest until closing. Above it sits up to NIS 180 million of contingent consideration, payable over 2027 and 2028 and only if CAL meets performance-linked thresholds.

Here too, the annual report is explicit that uncertainty is not only about whether the transaction closes, but also about what the final consideration will be after adjustment mechanisms, indemnity arrangements, and the contingent leg. This is exactly where 2025 stops being just a year of accounting noise and becomes a reminder that not all of CAL's open issues have been resolved. The litigation note presents about NIS 222 million of exposure from claims assessed as reasonably possible, and alongside that the VAT-assessment thread remains open: the older assessment that grew to NIS 75 million, additional assessments of NIS 192 million, and an August 2025 court ruling that partly accepted the appeal and sent the matter back for revised assessments, while CAL itself said it was still too early to estimate the full impact precisely.

The filings do not tie each of those exposures mathematically to the final consideration figure. But they do explain why the deal is not locked as simple cash. When indemnities, contingent consideration, price adjustments, and still-unsettled legal and tax matters are all present, even an asset with obvious value can stay stuck for a long time in the space between value that exists and value that has actually been realized.

Conclusion

The value in CAL exists, and it is fairly visible. Beinleumi holds an asset carried at NIS 874 million, discloses up to about NIS 132 million of immediate net sale gain, and up to about NIS 52 million of further contingent net gain. The problem is not that the value is hidden. The problem is moving that value from a balance-sheet line into an event that is closed in time, in price, and in capital use.

So the right way to read CAL inside the Beinleumi story is not as a more-than-NIS-1-billion exit, and not as an asset that stopped mattering. It is a holding whose value is already recognized to a large extent, whose premium above book is much smaller than the headline suggests, and whose realization still depends on approvals, adjustments, and CAL's own performance even after the agreement was signed. If the sale closes on time, Beinleumi gets a more liquid asset and an additional realization gain. If the process keeps slipping, CAL will remain exactly where the market likes it least: value that exists on paper, but has still not cleared the bottleneck.