Gazit Globe invites analysts to visit Finland and Germany, on their own dime
Gazit Globe means to play by the new rules and this week invited analysts to tour its properties in Finland and Germany, at their own expense.
No more may analysts fly abroad at the expense of a company they cover. New rules handed down two months ago by the Israel Securities Authority, outraged at the potential for conflict of interest, make that a crime. Local analysts wanting to visit a covered company's premises abroad have to foot the bill themselves, or at least at the expense of the investment bank employing them.
Gazit Globe invited analysts to a three-day tour of its operations in Finland and Frankfurt, which the group handles through Helsinki-listed group company Citycon. But analysts wanting to join Gazit chiefs Dori Segal and Shai Ben-Yakar,the chief financial officer, will have to bear the cost themselves, and the cost is $1,130 for a coach-class seat in the plane (or $1,800 if they want an upgrade to business class), plus 400 euros for two nights in Helsinki hotels.
While about reforming the behavior of analysts, the Israel Securities Authority also ruled that they have to disclose any business relations between the company they cover and their employing investment bank. And, under the new rules, if an analyst flies abroad at the expense of the client company, he could face up to a year in prison. It will be interesting to see how many analysts accept Gazit Globe's offer of a tour, not on its house though. Until now the analysts argued that these tours were extremely important to understanding a company's business.
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