TASE chooses bookrunner for its IPO

Ittai Ben-Zeev  photo: Tamar Matsafi

Jefferies will lead the offering, with participation from Leader, Barak Capital, Leumi Parters, and Poalim IBI.

In the midst of its ongoing disputes with its workers' committee, the Tel Aviv Stock Exchange (TASE) is going ahead with its IPO, and is recruiting local placement agents to work with Jefferies, its foreign bookrunner: Leader Capital Markets , Barak Capital, Leumi Partners, and Poalim IBI, with Discount Underwriting and Orion Underwriting and Issuances also likely to take part in the distribution of shares, sources inform "Globes."

Market sources said that the TASE, managed by CEO Ittai Ben-Zeev, wants to offer its shares to the public in the third quarter of the year at a company value of over NIS 600 million. At the same time, due to the structure of the IPO, it appears that a more solidly based indication of the value will be given only after the roadshow begins, which will take place as soon as the Israel Securities Authority approves the prospectus.

The concern that received the go-ahead to lead the TASE's offering is the Jefferies investment bank, which simultaneously became a remote TASE member. Jefferies has been cooperating for many years with Leader, which often focuses on analysis, which makes it likely that Leader will lead the proceeding in Israel. The selection of an international bookrunner, instead of a local one, indicates that the TASE is aiming at a non-uniform offering that will appeal to foreign investors and institutions, rather than the general public in Israel.

As of now, the TASE's prospectus has already been submitted to the Securities Authority, with which a discussion is now taking place. Experience shows that an offering by a company whose prospectus was already approved by the Securities Authority takes two to three weeks. The Securities Authority - the regulator responsible for the TASE - has another six weeks to consider the prospectus. Sources believe that it is entirely possible that the Securities Authority could very well approve the prospectus earlier than that, subject to changes and clarifications that it requests.

TASE's management wanted to hold its IPO in the fourth quarter of 2018, but the conflict with the workers, who demanded more than the 6% of the TASE's shares already granted them, prevented this. As of now, the dispute with the workers is still outstanding.

The first proceeding to offer at least 32% of the TASE's share got underway last summer, a few weeks after the deal was signed for transferring control of the TASE from its members, mainly the banks, to a number of foreign investment concerns. These were headed by US-Australian company Manikay Partners LLC, which holds 19.9% of the TASE's shares, entitling it to appoint a TASE director to represent it.

The other four foreign investors who bought shares in the TASE were Dalton, Moelis, Sunsuper, and Novo Nordisk Foundation, based on a Danish company of the same name. These four companies put most of their shares in the hands of Moshe Tery, a trustee, in preparation for a public offering as part of the buyers' undertaking to offer a large proportion of their holdings in the TASE, but they will remain shareholders after the IPO; each of them will have a stake of less than 5%.

In any case, Ben-Zeev said last September, "There will be no IPO below a NIS 551 million value - the value at which some of the four foreign corporations bought shares in the TASE when its Israeli controlling shareholders, headed by the banks, relinquished control of it. If there is no IPO, then the four foreign concerns that bought shares in the TASE will be allowed to sell their shares deposited with the trustee for this purpose.

The TASE's first quarter reports show that its shareholders' equity rose to NIS 563 million. The TASE also posted a NIS 5.4 million net profit on NIS 65 million in revenue. Both of these figures were less than in the corresponding quarter last year.

Published by Globes, Israel business news - en.globes.co.il - on June 24, 2019

© Copyright of Globes Publisher Itonut (1983) Ltd. 2019

Ittai Ben-Zeev  photo: Tamar Matsafi
Ittai Ben-Zeev photo: Tamar Matsafi
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