Shares of Tao Tsuot gained more than 100% in the last three days, lifting its market capitalization on the Tel Aviv Stock Exchange from NIS 28 million to NIS 60 million. That's impressive, but it's also true that the real estate company's market capitalization had maxed at half a billion shekels.
Yesterday Tao, which is controlled by Ilan Ben-Dov and managed by Yossi Arad, surged by 26.7%, after rising by 55.9% the day before.
"Tao's share has begun to behave like an option," commented a capital market player. "An investor could lose all his money, but his chances of making a profit have also increased. Some investors may be seeing this as an opportunity." There may not be much chance of making a killing on Tao stock, but the chance isn't zero, he added.
Next week Tao is convening its bondholders, possibly to offer them to convert the debt into shares and cash.
Concern had arisen about Tao's ability to repay C2 bondholders, after which Ben-Dov and Tao itself repurchased bonds and sold assets to improve the company's liquidity. One of its latest deals, reported on July 11, involved selling 11.7 million shares in IDB group company Discount Investment Corporation for $59.5 million, or nearly NIS 252 million, in an off-floor transaction.
Tao advised the Tel Aviv Stock Exchange that it would be posting a gain of NIS 49.1 million from the sale of the shares.
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