After announcing the cancellation of its Tel Aviv Stock Exchange IPO last night, the Shellanoo Group notified 40 out of its 65 employees in Israel that it was beginning hearing proceedings, ahead of firing them.
"Globes" was the first to report in July that the Israeli technology company, which is developing apps for smartphones and online services, was planning to raise money on the TASE. Shellanoo Group, controlled by Oded Kobo (38%) and Roman Abramovich (16%), was hoping to raise NIS 95 million at a company value of NIS 600 million, after money.
Sources familiar with the company said that it was planning to move operations overseas and not close down. However, in order to continue operating (according to remarks by accountants in the company prospectus), Shellanoo Group will still be required to raise money.
Shellanoo Group has blamed Israeli media criticism for its change of plans. A spokesman for Kobo said, "In recent weeks Shellanoo Group, its employees and shareholders have been subject to brutal attacks from several journalists and media people in Israel. Our basic aim was and remains that Israeli technological companies can flourish on the Tel Aviv Stock Exchange. Nevertheless, with the exaggerated disproportion of the attacks on us by various journalists, we have decided to focus the operations of the company in another place. Consequently, we have decided not to move forward with the IPO."
Criticism in the capital market in Tel Aviv was focused on the unreasonable pricing of the IPO, as a "company of dreams," and the large salary of Oded Kobo.
Shellanoo Group said, "Following the belligerence of the media and the decision to cancel the IPO, the company has begun a streamlining plan and at the same time is working for future business development."
Published by Globes [online], Israel business news - www.globes-online.com - on September 8, 2016
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