Business in Brief
Babylon, the high-flying online translation company, is delaying its initial public offering on Wall Street until January after its investment banks advised it to wait for the uncertainty surrounding the U.S. 'fiscal cliff' to pass.
Babylon delays Wall Street offering due to 'fiscal cliff'
Babylon, the high-flying online translation company, is delaying its initial public offering on Wall Street until January after its investment banks advised it to wait for the uncertainty surrounding the U.S. "fiscal cliff" to pass. Babylon's top executives, led by Alon Carmeli, are now expected to start the roadshow at the start of January, with the IPO probably taking place at the end of the month. The company filed a draft prospectus three weeks ago for the shares to trade on the Nasdaq, but the $115 million the document states will be raised ($100 million for Babylon and $15 million for underwriting fees) is probably less than the company plans to raise in practice. (Oren Freund)
Israel's service exports rose 7% in first nine months of year
Exports of services climbed 7% in the first nine months of the year, compared with the same time in 2011, to $21 billion, the Export Institute reported yesterday. The increase was led by exports of computer services, software and research and development. "In contrast to the trend in merchandise exports this year, service exports have continued to grow nicely compared to 2011," said Ramzi Gabbai, the institute's chairman. As a result total exports for 2012 will probably be unchanged from last year in dollar terms. It said business services (not counting start-up companies), which account for just under two third of the total, rose 7% to $13 billion. Tourism, which accounts for 18%, also rose 7% to $4 billion, the institute said. (Ora Coren)
Married business owners to get tax break
Married couples working in a business owned by one or both of the pair will be entitled to tax breaks for years up to and including 2012, the Tax Authority said in a move that could save them up to NIS 500 million. The decision comes after the High Court of Justice ruled that such couples were not entitled to file individually, a practice that would normally cut their tax bill by enabling the double deductions. The ruling, however, sorted out a series of contradictory lower-court rulings on the matter that had left many exposed to bills for back taxes, fines and linkage, all of which are being canceled by the Tax Authority now. Couples will be able to file individually for amounts of up to NIS 48,960 for tax reports that have not yet been filed, the authority said. The deadline to file in time to enjoy the break is March 2013. (Zvi Zrahiya)
Professional training to work in natural gas industry to begin soon
Training in the skills needed to install and operate natural gas facilities will be offered for the first time in a joint program by the Energy and Water Resources Ministry and the Industry, Trade and Labor Ministry. The natural gas sector didn't exist a few years ago but is now set to become the country's biggest source of energy as Israel's giant offshore gas fields come on line. In an announcement released yesterday the ministries said they are seeking out private and public institutions that can operate the training courses, the requirement being they can demonstrate a formal link to an overseas institution that has experience and credentials in the industry. "We're hoping to train hundreds of professionals already in the first year," said Shalom Ben-Moshe, director of the Industry Ministry's personal training and development branch. (Hila Weissberg)
IEC expands bond issue amid strong demand
The financially troubled Israel Electric Corporation said yesterday that it had expand the size of its private bond offering to NIS 988 million from the NIS 738 million originally planned, citing strong demand for the securities after the bonds were sold to institutional investors last week. Although the enlarged offering enables the state-owned utility to meet its fundraising needs for now, it is paying a high price. The first tranche of series 1113 bonds are due in one year and pay interest of 6.5% unlinked while the second tranche of 2022 series bonds, which are inflation-linked and have a seven-year term, pay interest of 5.7%. Equivalent Israeli government bonds carry coupons of 4.5 percentage points less. (Itai Trilnick)