Daily roundup / Frankenstorm scuttles Kamada stock meeting
Speculators bet against Israeli blue chips while Clal Insurance snaps up shares of Jerusalem Economic.
Sandy foils Kamada meeting with U.S. underwriters: Life sciences company Kamada is planning a stock offering on Nasdaq, but a meeting of company execs scheduled with potential underwriters had to be postponed because of Frankenstorm Sandy, which roared through the U.S. East Coast Monday night. Kamada, which trades at a market cap of NIS 820 million on the Tel Aviv Stock Exchange, is a mature company – not some biomed fantasy – that has a number of signature products, including Glassia technology to treat congenital emphysema that has been approved for sale in the U.S. Floating on Nasdaq would bring the company greater exposure to potential partners for mergers and acquisitions.
Speculators bent against Tel Aviv large-caps: Speculators are betting against Israeli blue chips. Open shorts on the TA-25 index increased by 6% at the end of last week to NIS 752 million, following a 7% jump the week before. Total open short positions on Israeli securities also continued to climb last week, rising 7% to NIS 14.6 billion. Who's in the doghouse? Mellanox was heavily shorted, with open positions increased by 300%. Bank Leumi wasn't much better with a 47% increase in shorts, but on the other hand, speculators smiled on Bank Hapoalim. Short contracts on Hapoalim dropped by 12%, after increasing 16% the week before, and 91% the week before that. Speculators also eased off energy and property conglomerate Delek Group short positions decreased by 82% week over week.
Bank of Israel mortgage constraints useless, analysts say: Economic analysts up and down the Holy Land were left red-faced yesterday after the Bank of Israel lowered its benchmark rate for November to 2%. That's because the consensus had been that the policy rate would stay where it had been, at 2.25%. Nor were they charmed by the macroprudential steps the central bank announced to cool down the roaring housing market: "Limiting mortgage loans to 75% of the property value for first-home buyers doesn't actually limit them," said Alex Zabezhinsky of DS Apex, on the grounds that most people borrow less than 75% anyway. Also, since bank deposits become even less attractive than they had been, more people will think to put their money into property, Zabezhinsky predicts. Moving onto Golan Sapir of the Sigma investments house: These steps do nothing to resolve the supply problem, he says. Supply remains short of demand and that's that.
Clal Insurance keeps Jerusalem Economic in TA-100: Clal Finance Kanaf, a subsidiary of IDB group company Clal Insurance, this week bought 400,000 shares from Jerusalem Economic Corporation or about 0.5% of the company's stock. Not much; but it increased the public float enough to keep the real estate company on the prestigious TA-100 index. The Tel Aviv Stock Exchange will be rebalancing its indexes in November and if Jerusalem Economic's public float had been below 20%, it would have been tossed off the TA-100, and the TA-75 as well.
Shari Arison moving to refinance debt: Arison Holdings, owned by billionaire heiress Shari Arison, is moving to place NIS 1.5 billion – if not more – in private bonds. The company, through which Arison owns her controlling interests in Bank Hapoalim and construction company Shikun & Binui, hopes to arrange fresh financing to replace private bonds placed in 2007 with institutional investors. The bonds issued in 2007 bear interest of 4.9% and come due from late 2014 to 2018.
Focal Energy raising $30 million more: The brokerage firm Poalim Capital Markets is leading a roughly $30 million financing round for the Israeli company Focal Energy, which invests in renewable energy projects in India. In previous financing Focal raised $23 million, including from the Migdal insurance company and venture investors. Focal invests in projects based on proven technologies together with local Indian investors: So far it has five in its portfolio producing 48.5 megawatts, of which about half connects to the power grid. Among its projects are electricity generation from biomass (agricultural waste), hydroelectric energy and wind energy. The company hopes to expand into solar energy as well.
With reporting by Michael Rochvarger and Yoram Gabison