Gil Agmon, the controlling shareholder in Delek Automotive Systems Ltd. (TASE: DLEA) with a 37.47% stake, has reached agreement with Delek Group Ltd. (TASE: DLEKG), controlled by Yitzhak Tshuva, to buy seven million shares in Delek Automotive - 7.5% of its shares, Delek Automotive reported today to investors. Delek Automotive imports Mazda, Ford, and BMW vehicles to Israel.
The NIS 135 million deal will take place in the coming days at NIS 19.27 per share, a 20% upside on the share's base price. Delek Automotive's share price responded to the news with a 10% jump.
Delek Automotive finished the third quarter of 2019 with a 180% increase to NIS 94 million in net profit, despite a decrease to NIS 862 million in revenue. The company's share price surged 18% in response to its results. Delek Automotive's gross profit and gross profit ratio improved in the quarter, mainly as a result of foreign currency changes, the mix of cars sold (despite a decrease in the total number of cars sold), and grants for the environmental sector.
Delek Automotive's total car sales were down 13% to 3,500 in the third quarter, and down 17% to 13,700 cars in January-September. Sales of all three brands sold by the company fell, both in the quarter and the first nine months of 2019. As part of Delek Automotive's efforts to cope with the difficult state of the auto market, it expanded into the environmental and infrastructures sector, investing NIS 1 billion in acquiring a 70% controlling interest in Veridis, which supported its business results. Veridis's energy activity, with a 20% holding in the OPC power station at Mishor Rotem, stood out positively in the third quarter. Veridis's results were consolidated in Delek Automotive's report for the first time in the third quarter of 2018.
Delek Automotive's share price has soared 30% since the company published its reports in November, pushing its market cap on the Tel Aviv Stock Exchange up to NIS 1.67 billion.
Published by Globes, Israel business news - en.globes.co.il - on December 8, 2019
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