Holding company Lapidoth Capital, controlled by its chairman Jacob Luxenburg, is acting to float infrastructure and construction company Danya Cebus, Lapidoth reported to the Tel Aviv Stock Exchange this morning.
Lapidoth Capital bought control of Danya Cebus in January this year, after completing the acquisition of 80% of Africa Israel Investments in a debt settlement. Altshuler Shaham Provident Funds and Pension bought the remaining 20%.
Danya Cebus, which holds a 56% stake in Africa Israel Residences, posted a net profit of NIS 24.3 million in the second quarter of this year, more than double the NIS 11.8 million net profit posted for the corresponding quarter of 2019. The company's orders backlog grew by NIS 1.35 billion in the first half of this year to NIS 8.5 billion at the end of June, mainly thanks to growth in its construction and infrastructure activity in Israel.
If the flotation takes place, Danya Cebus will first distribute its shares in Africa Israel Residences to Africa Israel Investments, in accordance with the Concentration Law, which obliges Lapidoth to eliminate at least one layer of its holdings structure. These shares are currently worth NIS 690 million at market price.
Several infrastructure and construction companies are currently traded on the Tel Aviv Stock Exchange, among them Shikun & Binui Holdings and Ashtrom Group, which are traded at trailing p/e ratios of 14-25. On this basis, a flotation of Danya Cebus would be at a valuation of NIS 1.2-1.5 billion, although divestment of Africa Israel Residences will cut the valuation substantially.
Danya Cebus was founded over fifty years ago. It employs about 2,000 people in Israel and around the world.
Over the past year, Lapidoth Capital has doubled its market cap to some NIS 1.2 billion.
Published by Globes, Israel business news - en.globes.co.il - on September 6, 2020
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