The share price of Tower Semiconductor Ltd. (Nasdaq: TSEM; TASE: TSEM) soared 40% today on the Tel Aviv Stock Exchange (TASE). The share price was closing the arbitrage gap with Nasdaq following the announcement Friday that Tower is to set up a joint venture with Panasonic Corporation to manufacture Panasonic’s products.
"Globes" spoke to Tower CEO Russell Ellwanger.
Would you define the deal with Panasonic as a game changer?
"Yes to a certain extent. This is a very positive announcement and it will allow us to continue leading in the markets in which we work."
Can the deal bring in major new customers because of the reputation of Panasonic?
It's reasonable to assume so but I also want to stress that Tower has an excellent reputation and we serve good customers around the world. What is the case is that Panasonic can help us in the Japanese market. Panasonic is a giant company and with its plants there is a very good chance of getting new Japanese customers. Regarding the rest of the world we already have a good name."
Were you surprised the way the share price soared on Friday?
The truth is that I'm often surprised by the market's reactions to Tower's announcements and I don't always understand those reactions. But clearly I was satisfied with the trading on Friday. It's a pleasure to see something that you've built, that you've invested so much energy in give positive expression on the capital market."
Tower reported on Friday that the joint venture is expected to be worth $400 million in sales to Tower annually. This will enable Tower to reach an annual rate of sales of at least $900 million in the next five years, starting from the second quarter of 2014.
Published by Globes [online], Israel business news - www.globes-online.com - on December 22, 2013
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