The Tel Aviv Stock Exchange (TASE) indices were mixed today. The Tel Aviv 25 index rose 0.07% to 493.84 points, the Tel Aviv 100 fell 0.25% to 519.10 points, and the Tel-Tech fell 2.10% to 354.30 points. Turnover was NIS 429 million.
After two especially stormy sessions, due to the capture of Saddam Hussein on Sunday and the battle for inclusion in the 2004 Tel Aviv 25 index yesterday, there was little drama in today's trading before 4 pm. The leading indices were declining, mostly due to yesterday's drop in New York; today's falling prices on the European bourses; and the negative November CPI, published yesterday, indicating that the recession is not yet over, belying Minister of Finance Benjamin Netanyahu's hasty declaration.
As I mentioned, this was the case until 4 pm, when Fitch Ratings upgraded its outlook on Israel's long-term foreign currency rating to "Stable" from "Negative". At the same time the agency affirmed Israel's long-term foreign currency rating at 'A-', unchanged since 1995.
In reaction to these events and to Fitch's upgrade, the Tel Aviv25 index's 1% decline quickly changed into a 0.07% increase by the close, although both the Tel Aviv 100 and Tel-Tech indices stayed in negative territory.
Profit-taking on Alvarion
Alvarion (Nasdaq: ALVR; TASE:ALVR) shoved its way onto center stage. Alvarion has joined the Tel Aviv 25 list, and will be traded on it from January 2004. The share fell 5.3% today. Meanwhile, Delek Automotive Systems (TASE:DLEA), which had also been competing to join the Tel Aviv 25 index, but failed to make the grade, rose 1.9% today, after diving 7% yesterday.
In the final minutes of trading, Dankner Investments (TASE:DKNR) sold a block of Matav-Cable Systems Media (Nasdaq: MATV; TASE:MATV) for NIS 15 million, dragging the share down 2.4%.
Bank shares, which rose strongly with the capture of Saddam, were the subject of profit-taking today. Bank Hapoalim (LSE:BKHD; TASE:POLI) fell 0.5%; Bank Leumi (TASE:LUMI) fell 1.4%; Israel Discount Bank (TASE:DSCT) fell 0.1%, although United Mizrahi Bank (TASE: MZRH) rose 1.8%. Israel Salt Industries (TASE:SALT), whose main purpose is to hold the Dankner family's shares in Bank Hapoalim, fell 4.4% today.
The reason for the fall was Salt Industries' announcement that it expected to post a NIS 8.6 million capital loss in the fourth quarter from the sale of Bank Hapoalim shares on the TASE yesterday. On Sunday, Salt Industries announced the sale of NIS 48 million worth of Bank Hapoalim shares, and today it announced that its debt to Mizrahi Bank, which had financed part of its acquisition of Bank Hapoalim, amounted to NIS 9.50 a share. The sale price per share was NIS 10.60, with together with the dividend, reached NIS 11 per share. This means that Salt Industries expects a cash flow surplus of NIS 1.50 per share.
Waiting for an offer to purchase from Eden Springs
Eden Springs (TASE:MEYD) rose 2.6% today on a NIS 9.1 million turnover. The rise was ascribed to the company’s announcement that it had begun implementing the second stage of the Danone deal. In this stage, Groupe Danone (NYSE:DA; XETRA; Paris:DANO) has acquired from Eden Springs' controlling shareholder, the Naftali family, 19.8% of Eden Springs Israel at a company value of €410 million. The deal will give Danone 24.13% of Eden Springs Israel.
The shares were bought from brothers Ronny, Yehuda, and Giora Naftali, and from Aqua Partners. The sellers will receive €81.8 million altogether, of which €73.6 million has already been received, and the balance will paid in a few weeks, following a new valuation for Eden Springs that will take its large debt into account. After the Naftali brothers receive the balance of the payment from the sale to Danone, the third stage of the deal is scheduled to take place - a guaranteed offer to purchase from the public.
When the deal was signed in the first half of this year, the Naftali brothers promised to bring the public, which owns 67.8% of Eden Springs, into the deal. They promised to publish a partial offer to purchase 11.3% of the shares at the final closing price of the deal.
Arazim Investments (TASE: AZRM) rose 4.52% today on an extraordinary turnover of NIS 635,000. The rise was attributed to a company announcement that it expected to post a NIS 25 million capital gain in the fourth quarter from the sale of six real estate properties for NIS 64 million. Arazim will post a net profit of NIS 55-57 million in 2003, thanks to the profit from these sales, together with accumulated profits in January-September.
Published by Globes [online] - www.globes.co.il - on December 16, 2003