Hotel company Pie Siam (TASE: PIES) began trading on the Tel Aviv Stock Exchange yesterday. The company was founded and is controlled by veteran real estate developer Shlomo Dahokey, who serves as chairman. Until recently Pie Siam was owned jointly by Dahokey and Aspen Group (TASE: ASGR).
Aspen Group sold its shares in the IPO while Pies Siam also issued new shares, which were bought by institutional investors at a company valuation of NIS 810 million. Pies Siam becomes the fourth purely hotel company on the TASE, joining Fattal, Isrotel and Dan Hotels.
Pie Siam, which was founded in 2007, currently operates two Ibis Hotels in Jerusalem and owns together with Isrotel 50% of a hotel near Tel Aviv Port, which is operated by Isrotel. Pies Siam plans to develop and build six more hotels including a vacation village with Isrotel by the Kinneret in Amnon Bay, and hotels in Safed, Mevaseret Zion, Jerusalem and the Dead Sea. The company is also promoting the construction of three sheltered housing schemes: Two in Tel Aviv (one in Neve Tzedek) and one in Jerusalem's Haneviim Street.
Dahokey, who now holds a 50% stake in Pies Siam, told "Globes" after completing the IPO that he believed the institutional investors had come in at the right time with signs that the war is winding down and expectations for a recovery in the hotel sector. He said, "We feel that we are talking about the end of the road (for the war). Foreign airlines are beginning to return to the country, and the hotels in places like Jerusalem and Tel Aviv, which rely more on foreign tourism, are expecting to recover."
Dahokey added, "The core activities of Pie Siam, which are the initiation, planning and improvement of properties, were not affected at all during the war - quite the opposite. During this period, the company advanced most of its plans. Our special locations brought Israelis over the weekends. We made it through the period safely and from an operational point of view we were quite balanced. As soon as flights return, the occupancy rate in hotels will soar."
As far as is known, Dahokey was aiming for a higher value of almost NIS 1 billion for Pie Siam, but in the end the valuation at which its shares were sold to institutional investors in the deal was almost 20% lower. However, his associates see the completion of the move as a success for him.
Pizza and KFC franchising
The IPO now returns Dahokey (67), to the position of sole controlling shareholder in Pie Siam, where he serves as chairman. Dohki has 35 years of experience in initiating, managing, planning and building residential, commercial, industrial, hotel and senior citizens housing projects through his company Penthouse. In the past, he was also a franchisee of the Pizza Hut and KFC food chains in Israel. Among other things, Dahokey's company has built thousands of housing units across the country including in Jerusalem, Tel Aviv, Rishon LeZion, Shoham, Mevaseret Zion, and Eilat. He developed and built the Harel Mall in Mevaseret Zion, the Rav Shefa Mall in Jerusalem, and the Queen of Sheba Mall in Eilat.
Pie Siam ended the first nine months of 2024 with revenue of NIS 21.5 million, down 27% on the corresponding period of 2023. The decrease was due to the outbreak of the war and the occupancy of the hotels by evacuees. Pie Siam recorded a net loss of NIS 36 million compared with NIS 62.5 million in the corresponding period of 2023. The reduction in the loss was mainly attributed to differences in the fair value of its assets between the periods.
Published by Globes, Israel business news - en.globes.co.il - on January 23, 2025.
© Copyright of Globes Publisher Itonut (1983) Ltd., 2025.