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It is rare for an offering to flop at the public phase, after the institutional one went well. But it happens, and actually - it happened in three of the offerings in the last month.

Usually the institutionals commit to buying about 80% of the offering, leaving just 20% for the general public. Once the institutionals are on board,  the IPO is all but safe as houses.

Yet in the unlucky three offerings, the underwriters were forced to exercise their underwriting commitments and pick up some of the merchandise.

Possibly they had anticipated as much because the institutional rounds had not gone easily in any of the three cases.

Real estate company Tesoua 10 (TASE: TSOA http://www.tase.co.il/TASEEng/Management/GeneralPages/SimpleSearchResult.htm?ObjectId=01080605&SecurityType=0&ObjectType=1) issued bonds, and found 265 units seeking buyers. The underwriters were forced to take up half a million shekels worth of paper, even though at the institutional phase, institutionals affiliated with the underwriters had ordered 94% of the bonds.

Analyst Underwriting had been the lead book maker for Tesoua 10.

Then there was PMS, owned by Ronen Zellnir and others. At the institutional phase, the institutionals undertook to buy 70% of its offering, but the public phase ended with under-demand, forcing the underwriters to buy 5,385 units for NIS 5.2 million.

The PMS offering had been handled by Poalim IBI.

The third case was Starling Advanced Communications, which belongs to the IDB group company Elron Electronic Industries (Nasdaq, TASE: ELRN). It too had trouble at the institutional phase and finally pulled it off by the skin of its wings, despite reporting that ex-chief of staff Dan Halutz is a candidate to chair the company.

But having weathered the institutional phase, somewhat, Starling fell to earth at the public one. The underwriters had to bite the bullet and buy NIS 6.4 million worth of merchandise.

At the institutional phase, unusually, the underwriters agreed to buy only 53% of the securities instead of the usual 80%. Most of the undertakings were buy bodies affiliated with the underwriting consortium. Elron committed to 28% more.  Starling's offering had been handled by Clal Underwriting.

Starling had issued both bonds and shares, raising $14 million, of which Elron ponied up $4 million.