Investors may continue to focus on IDB group companies today, after the conglomerate announced financial results for the fourth quarter. IDB Holdings and IDB Development shares have been under pressure this week, and both lost about 3% yesterday after dropping 5% on Sunday.
“Globes” reported yesterday that Nochi Dankner, the designated buyer for the IDB group, had asked the Recanati and Carasso families to lower their price for the deal by 10-15%, which would reflect a $700-750 million value for the concern. The deadline for closing the agreement has been postponed to April 30.
IDB Holdings traded at a $525 million company value at yesterday’s close, 37% below the agreed price for the deal. The value for the company was lowered from $1.05 billion to $840 million in November 2002, or $434 million for 51.7% of the IDB Holdings.
This morning, IDB Holdings said it lost NIS 252 million in the fourth quarter, after writing down NIS 193 million to account for the new Accounting Standard 15 code. The new accounting code requires companies to record assets at market value.
For year 2002, IDB Holdings posted a NIS 380 million loss, compared with a NIS 831 million loss in 2001.
IDB Holdings' subsidiary IDB Development reported a NIS 416 million loss in the fourth quarter, after accounting for NIS 321 million in write-downs for Accounting Standard 15. IDB Development narrowed its year 2002 loss to NIS 535 million, compared with a massive NIS 1.32 billion loss in 2001.
With results in from IDB, investors now have fourth quarter reports from all of Israel’s major companies.
Bank Leumi shares may attract interest, after UBS Warburg cut its price target to NIS 4.55 from NIS 5.20. Leumi shares closed yesterday at NIS 4.653.
Analyst Stephen Levey said, “While Leumi did not take the kind of provisions that Hapoalim took in the fourth quarter, we believe that this will simply act to spread the pain of high provisions across 2003.”
Dual-listed Teva (Nasdaq: TEVA) may decline slightly on the back of a 1.3% negative arbitrage gap with its Nasdaq share, which closed on Monday at $41.65.
Yesterday, the Tel Aviv 25 index closed down 0.71% at 333.90 points, the Tel Aviv 100 index fell 0.46% to 341.69 points, and the Tel-Tech 15 index lost 0.60% to 179.65 points. Turnover totaled NIS 155 million.
Published by Globes [online] - www.globes.co.il - on 1 April, 2003