Bet Shemesh Engines Ltd. (TASE: BSEN), controlled by FIMI Opportunity Funds, is embarking on a financing round of up to NIS 137 million ($40 million) through a rights issue to its existing shareholders. The current round comes after the company raised NIS 19 million ($5 million) from FIMI in a private placement at NIS 74.50 per share. The price for the rights issue is slightly lower, at NIS 74 per share. FIMI, which owns 45% of Bet Shemesh Engines, has already announced that it intends to fully participate in the rights issue, thereby ensuring that the amount raised will not be less than NIS 62 million. Other large shareholders in Bet Shemesh Engines are Meitav Dash Investments Ltd. (TASE:MTDS) (12.4%) and Menorah Mivtachim Holdings Ltd. (TASE: MORA) (9.7%).
Bet Shemesh Engines manufactures parts for jet engines, including precision casting of metal parts. The company also renovates, assembles, and does engineering work on various engine parts. The services and products provided by the company are designed for the civilian and military aviation markets, but most of its sales are currently to the civilian market.
According to the company, the financing round is to support anticipated growth in its business and expanded investment in operational infrastructure. Bet Shemesh Engines has taken some very substantial orders in recent years.
Bet Shemesh Engines CEO Ram Drori said, "The global aviation market has been on a growth trend in the past few years, and this trend is expected to continue at least into the next decade. This global trend is also good for Bet Shemesh Engines, which has signed large deals with international customers in recent years (such as Pratt & Whitney, O.C.), while substantially increasing its framework agreements." Drori added, "Development requires preparation and adaption of the company's facilities in Israel and Serbia, in addition to its regular investments. We believe that growth potential exists in our fields of business in the coming years, and that suitable operational and financial preparation will help realize these opportunities."
Bet Shemesh Engines' current share price is NIS 81.60, reflecting a NIS 570 million market cap. The company's share has climbed 26% over the past year, and has soared 278% in the past three years. FIMI, led by Ishay Davidi, has seen a NIS 100 million return on paper on its investment in Bet Shemesh Engines, after buying 43% of the company at only NIS 45.80 per share in July 2016.
Published by Globes [online], Israel Business News - www.globes-online.com - on January 25, 2018
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