Fidelity sells 1.5% Rami Levy stake

Rami Levy  photo: Tamar Matzafi
Rami Levy photo: Tamar Matzafi

The US fund still has a 7% stake in the Israeli retail chain.

Fidelity Management and Research (FMR) recently reduced its holding in retail food chain Rami Levy Chain Stores Hashikma Marketing 2006 Ltd. (TASE:RMLI) by selling 1.5% of the chain's shares (203,000 shares) in on and off-floor deals for a total of NIS 30 million. A notice published today by the chain (controlled by CEO Rami Levy) shows that the average share price in the deals was NIS 148, reflecting a 4.5% discount on today's opening price.

Following the sale, FMR's stake in the chain will be just over 7%, with a NIS 150 million value. The chain's market cap is NIS 2.1 billion, after dropping 10% over the past year.

Managed in Boston, FMR is regarded as one of the world's largest investment groups. It became a party at interest in Rami Levy in 2013, following a string of purchases in regular Tel Aviv Stock Exchange (TASE) trading giving it a 5% holding in the company. Its most recent purchases of shares in the chain were at about the same company value for Rami Levy as its current market cap. Shortly after FMR became a party at interest in the chain, Rami Levy sold it some of his shares for a total price of NIS 20 million in an off-floor transaction at a NIS 167 share price.

Another foreign concern holding Rami Levy shares is the MSD fund, founded by Dell Computers owners Michael Dell. MSD became a party at interest in the chain in 2013 by buying a 4.8% stake from controlling shareholder Rami Levy for NIS 90 million. MSD's current holding is 10%, with a current value of NIS 200 million.

Levy also sold a substantial 3.5% stake to investment institutions for NIS 72 million in recent days. This deal was at NIS 154 per share, reflecting a 2% discount on the market price during the sale. The deal took place before the record date for the public's share holdings under the indices reform being promoted by the TASE, which is due to take effect within a few weeks. This deal by Rami Levy is believed to have increased the public's share in the chain to 45%, thereby increasing the Rami Levy share's weight on the Tel Aviv 90 Index (planned to replace the Tel Aviv 75 Index) from 1.5% to 2%. He hopes that this increase will boost trading in the share and the demand for it.

Rami Levy finished the first nine months of 2016 with a 13% rise in revenue to NIS 3.4 billion and a 31% jump in profit to NIS 77 million.

Published by Globes [online], Israel Business News - www.globes-online.com - on January 3, 2017

© Copyright of Globes Publisher Itonut (1983) Ltd. 2017

Rami Levy  photo: Tamar Matzafi
Rami Levy photo: Tamar Matzafi
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