Mivtach Shamir Holdings Ltd. (TASE:MISH), the holding company controlled by Meir Shamir, has announced that its Indian subsidiary Jarvinia Holdings Ltd. has filed a prospectus with the Israel Securities Authority to hold an IPO on the basis of its financial report for the third quarter of 2009.
The primary market appears to be reawakening after almost two years without an IPO on the Tel Aviv Stock Exchange (TASE). Rising share prices have whetted investors' appetites, and several companies, including Azrieli Group, have begun preparing prospectuses.
Most of the companies planning IPOs are stable and profitable. However, Jarvinia is considered a higher risk company, which mainly offers potential, rather than a stable cash flow. Jarvinia's flotation will a test case to see whether the market is ready for IPOs of this kind.
Two months ago, "Globes" reported that Mivtach Shamir planned to float Jarvinia, in which it owns a 35% stake, at a company value of $100-150 million. Jarvinia's other shareholders are private investors.
Jarvinia is a real estate developer, and is a partner of mobile infrastructure developer TowerVision India Ltd. in which Mivtach Shamir is also a partner.
Two and a half years ago, Jarvania entered the hotel business through a subsidiary. In order to reduce its risk in this industry, its business model is based on building hotels only after it has a long-term rental contract in hand. Jarvinia has invested $25 million in this activity and now owns a 25% stake in the subsidiary. The company has four hotels, in Mumbai, Pune, Goa, and Chennai. The hotels are joint ventures with global hotel group, Accor SA (Euronext: AC), and are financed by Indian banks.
Published by Globes [online], Israel business news - www.globes-online.com - on January 17, 2010
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