Koor Industries Ltd. (TASE:KOR), a unit of Nochi Dankner's IDB Holding Corp. Ltd. (TASE:IDBH), swung to a net profit for the third quarter of 2012, boosted by strong results by Makhteshim Agan Industries Ltd. and higher share price of Credit Suisse Group AG (NYSE: CS; SWX: CSGN; XETRA: CSGZ).
Koor's revenue rose to NIS 525.8 million for the third quarter from NIS 54.8 million for the corresponding quarter of 2011, and it posted a net profit of NIS 418.8 million (NIS 8.80 per share), compared with a net loss of NIS 1.63 billion.
The rise in Credit Suisse's share price contributed NIS 334 million to Koor's third quarter profit. The subsequent further rise in the share price has added another NIS 181 million to the value of Koor's stake, and will be reported in its financial report for the fourth quarter. Koor owns 30.3 million Credit Suisse shares, amount to 2.3% of the bank's share capital.
Makhteshim, in which Koor owns a 40% stake, also contributed to Koor's results. During the quarter, Koor repaid a NIS 254 million loan, and has repaid NIS 3.7 billion in loans and bonds since the sale of Makhteshim to China National Chemical Corporation (ChemChina) in November 2011.
Koor had NIS 2.23 billion in cash at the end of September.
As part of the restructuring at IDB, Koor may be merged with its direct parent company Discount Investment Corporation (TASE: DISI), or become a wholly-owned subsidiary of it. If this plan is implemented, Koor's public shareholders and Discount Investment's parent company IDB Development Corporation Ltd. will be offered to sell their shares in Koor. Koor's bonds may be bought or repaid as part of a deal, using proceeds from the sale of Koor assets.
Alternatively, Koor may be merged with IDB Development or IDB Holdings as part of a large loan to IDB from US private equity fund KKR & Co. LP (NYSE: KKR). If this alternative is implemented, Koor's shareholders, including Discount Investment and IDB Development will be offered to sell their shares, and Koor and Discount Investment's bonds may be bought or repaid, using proceeds from the sale of Koor assets.
Published by Globes [online], Israel business news - www.globes-online.com - on November 21, 2012
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