The Israel Postal Company has been bought by the municipal service provider Milgam for NIS 461 million ($125 m.) after the company won the tender for it, marking the first time in Israel's history that a private company will manage the postal service, Israeli media reported on Sunday.
The purchase was approved by Israel's Government Companies Authority to sell state shares. Many companies have considered acquiring the postal service in the past year.
In the bidding that took place, 15 companies showed their interest, while some ultimately withdrew from the tender.
The Rami Levi company offered NIS 380 million ($103 m.) for the postal service in its bid and came in second in the final stage of the tender.
According to reports, it was initially estimated that the Israel Postal Company would be sold for well over half a billion shekels. However, after years of financial losses, it was sold for far less, alongside a significant recovery arrangement that amounted to NIS 1.7 billion.
The Israel Post Company's operations
The Israel Postal Company has been operating under a license supervised by the Communications Ministry and following the postal law's rules, which define standards for its activity, such as service level, universal distribution, and product supervision.
Over the past year, Israel Post has undergone an austerity and recovery plan that includes reducing payroll expenses, moving to digital services, closing branches while opening hundreds of delivery centers, and transferring a significant portion of its assets to the state.
“The privatization of the mail is great news - for the economy, the treasury, and much more for the general public, who will receive a more efficient, faster, and higher quality service,” said Michal Rosenbaum, director of the Government Companies Authority.
Reuters contributed to this report.