Never a dull moment in Nisko Industries, which manufactures electricity meters, markets electronics components, and makes venture capital investments. Nisko's three major shareholders - Arieh Kadron, Itzhak Nitzan and Efraim Sagie - continue to sell off their holdings in the company, which is already traded at a market value of $168 million (86% higher than at the beginning of the year). Nisko today announced that the three reached an agreement with IBI Underwriting and Merrill Lynch, whereby they will sell the two companies 400,000 shares (about 5.5% of share capital) for NIS 37.6 million.
The option agreement, exercisable within two months, is based on NIS 94 per Nisko share (currently traded at NIS 96.4). The sellers will also be entitled to 50% of the profit from the sale of the shares to third parties. The shares will eventually be sold to institutional and foreign investors.
The current sale, also made by Nisko's three controlling shareholders in equal parts, brings to NIS 78 million the value of holdings the three have sold since the beginning of the year. This is undoubtedly one of the biggest sales in the Israeli capital market recently. In February of this year, the three signed a similar option agreement with IBI and Merrill Lynch, whereby they sold about 3% of the company's share capital. The three recently sold NIS 17.5 million worth of shares to provident funds.
The intensive share sale coincides with a move intended to increase Nisko's value by selling and issuing holdings. The opening shot was fired in April, when Nisko sold its holding in Uniskor (74%) to Flextronics (Israel) for $20 million, in a deal that generated a NIS 44 million capital gain for Nisko.
Another Nisko subsidiary, Nisko Projects, is due to issue on the Tel Aviv Stock Exchange at a company value of $80 million next month. The financing round will be led by IBI. Nisko Projects, which will seek to raise $20 million, manages Nisko's electronics and communications holdings in Israel and abroad through several subsidiaries.
The next step is expected to involve issuing Nisko's high-tech division (which manages the group's holdings in venture capital fund Neurone, Imagine, CTMotion, Eldat Communications, Telescicom, and others). Another issue in the pipeline involves JCE Data, a Nisko Projects subsidiary that markets electronics components.
Nisko's Q1 profit was NIS 2.2 million on sales of NIS 188 million. The company's revenues for 1999 were NIS 234 million, and its net profit was NIS 6 million.
Published by Israel's Business Arena on 18 July, 2000