Wiz founders Rappaport and Costica add television to their post-exit portfolio with $120 million Reshet 13 deal
The pair will take control of Reshet 13 through the Merit Fund after the Second Authority approved the ownership transfer.
The Second Authority Council approved the transfer of control of Reshet 13 to the Merit Fund on Wednesday, clearing the final regulatory hurdle for a deal backed by Wiz founders Assaf Rappaport and Yinon Costica.
The approval brings to a close one of the most contentious ownership sagas in Israeli television, which unfolded alongside an escalating dispute between the government and the High Court of Justice over the composition and authority of the Second Authority Council.
Under the deal, Merit, a public-benefit company, will hold the shares and control of Reshet 13. The acquisition is being financed by Rappaport and Costica, who are also committed to injecting $120 million into the broadcaster over three years. Other technology entrepreneurs had initially been identified as potential financiers, but ultimately did not transfer funds to Merit for the acquisition, leaving Rappaport and Costica as the sole financiers of the deal.
The Second Authority said the approval followed several discussions and a comprehensive review of the transaction, including its ownership structure, sources of funding, the purchasers' commitments and the ability of Reshet 13 to continue operating while safeguarding the public interest and the broadcaster's independence.
As part of the approval, the council imposed several oversight and transparency requirements, including disclosure of funding sources and conditions governing future donors. It also sought to strengthen the independence of the broadcaster by expanding the circle of decision-makers within Merit.
The authority said Merit would provide guarantees covering the completion of investments in local content and the creation of a significant financial buffer.
“Approval of the transaction was granted following a comprehensive and in-depth review of all aspects of the acquisition, the purchasers' commitment to ensuring the continued proper operation of Reshet 13, and the establishment of oversight and transparency mechanisms,” said Council Chairman Mordechai Mordechai. “The Council was guided, first and foremost, by the public interest alongside the preservation of the broadcaster's independence.”
Reshet 13 CEO Idan Elrom described the approval as a turning point for the broadcaster.
“The Second Authority's approval of the transfer of the control permit is a historic milestone for Reshet 13, signaling a transition from a period of struggle to one of momentum and growth,” Elrom said in a statement. “The vision, commitment, and full backing of the new ownership group enable us to accelerate development plans, be bold, innovate, and offer the Israeli viewer a higher-quality, more relevant, and more diverse viewing alternative.”
The transaction had emerged in March as an alternative to a proposed takeover by businessman Patrick Drahi, who controls HOT and the international news channel i24News. That deal encountered regulatory obstacles related to cross-ownership. The Merit transaction, by contrast, was structured so that the public-benefit company would hold the shares and control of Reshet 13 rather than the individual technology investors.
The new owners have said they intend to treat Reshet 13 less like a traditional television broadcaster and more like a technology-driven media company, with substantial investment in content and digital platforms.
“The new ownership group brings with it a 'media start-up' model,” Reshet 13 said, describing plans for investment in content, advanced digital platforms and the news division.
Merit also welcomed the approval, saying its entry into Reshet 13 reflected its belief in the importance of “free, independent, and high-quality Israeli media.”
“Our goal is to provide management, on-air talent, and staff with the best tools, both technological and financial, to transform Reshet 13 into Israel’s leading, boldest, and most innovative media organization,” the fund said.
It also thanked Access Industries and Sir Len Blavatnik for their work on behalf of Reshet Media and said it looked forward to continuing to collaborate on the company's future.
