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TEL AVIV, Sept 7 (Reuters) - Argentinian businessman Eduardo Elsztain, the controlling shareholder in Israeli conglomerate IDB Development Corp, said on Wednesday he has appointed JPMorgan to find a buyer for the group's subsidiary Clal Insurance.
IDB is required to sell its stake in Clal to abide by Israeli regulatory requirements that prohibit holding companies from owning both financial and non-financial businesses.
The latest move follows two failed attempts by IDB to sell its 55 percent stake in Clal, one of Israel's biggest insurers, to Chinese investors.
"We are spending a lot of money, time and effort to achieve ... a sale," Elsztain told a news conference to mark four years since he invested in IDB.
IDB's holdings include Cellcom, Israel's biggest mobile phone operator, and leading supermarket chain Shufersal .
Another Israeli conglomerate, Delek Group, has also run into difficulties selling its 52 percent stake in insurer Phoenix Holdings. Last month Delek agreed to sell the stake to China's Fujian Yango Group but the deal is still awaiting regulatory approval.
IDB had an agreement with Israel's capital markets and insurance regulator that if it did not sell Clal by early 2016, it would have to sell 5 percent of the insurer every four months. But the matter has been taken up by the Tel Aviv District court, which has yet to make a final decision.
"A forced sale will make a tremendous loss to shareholders," Elsztain said.
Elsztain, who has invested nearly 2.5 billion shekels ($665 million) in IDB, acquired the heavily indebted group from former Israeli tycoon Nochi Dankner when it was structured as a six-layer pyramid with one holding company controlling another and had 16 billion shekels in debt.
It has since been reduced to two layers with the now private IDB Development owning 76 percent of Discount Investment Corp , which in turn holds stakes in Cellcom, Shufersal and other companies. IDB and Discount combined now have debt of 5.6 billion shekels.
"Hopefully in a year's time we will only have one level," said Elsztain. ($1 = 3.7579 shekels) (Editing by Steven Scheer, Greg Mahlich)