Business in Brief

Bloomberg

Novartis in talks to buy stake in Gamida Cell

Two and a half months after reports that Gamida Cell had broken off talks with a multinational drug company, Jerusalem-based Gamida Cell, which specializes in stem-cell drug therapies, is again in talks with a multinational, apparently Novartis. If the talks come to fruition, they would have the Swiss-based drug giant purchase a 15% stake in the Israeli firm with an option to acquire the entire company. Gamida Cell is currently controlled by Elbit Medical Technologies and Clal Biotechnology Industries. The option to acquire all of Gamida Cell would be subject to the benchmarks related to the Israeli company’s development of its Nicord product, through which Gamida Cell is developing treatments for cancer using umbilical cord blood. The thinking in the industry is that the prior negotiations broke down over reports that Novartis was the multinational in talks with Gamida Cell and over disclosure of terms of their proposed agreement. (Yoram Gabison)

Hapoalim to face low penalty in U.S. tax affair

Bank Hapoalim is likely to be penalized far less than Bank Leumi as part of the U.S. probe into banks that helped American citizens evade taxes, said Alon Glazer, VP for research at Leader Capital Markets, who published a positive review of the bank. Hapoalim recouped 385 million shekels in problematic debt, one of the factors contributing to the bank’s healthy second-quarter results. Hapoalim had net profit of 783 million shekels in that quarter, a 19% gain over the parallel quarter of 2013. Leumi is likely to pay more than 1 billion shekels to end the affair with the U.S. authorities. (Michael Rochvarger)

Arison sells Bank Hapoalim shares for $51m

Shari Arison, the controlling shareholder of Bank Hapoalim, sold 176 million shekels ($51 million) worth of Hapoalim shares, the bank said yesterday. Arison owns 20.3% of Hapoalim, Israel’s largest lender, through Arison Holdings and another 1.3% through Salt of the Earth Ltd., a unit of Arison Holdings. Hapoalim said Salt sold 8.75 million shares in a deal outside of the market at 20.12 shekels a share – a discount to Thursday’s closing price of 20.52 shekels. The price fell 1.5% to 20.20 shekels yesterday. Salt, which had owned 17.1 million shares, sold the tranche to Israeli brokerage Excellence. Excellence had already owned a 3.5% stake in the bank and sold the shares on to foreign investors. Arison has sold Hapoalim shares through Salt a number of times as part of a strategy to reduce leverage while boosting the number of foreign investors in the bank. (Reuters)

Dan Hotels revenues down due to fighting

Dan Hotels’ third-quarter revenues are likely to be 30% less than those from the parallel quarter in 2013 due to Operation Defensive Edge. The hotel chain expects to take in 96 million shekels less this quarter, for a total of 223 million shekels, due to fewer reservations coupled with cancellations. These figures could change in keeping with changes in the security situation, the chain noted. The hotel added that it could not yet say how this would affect its bottom line. Dan Hotels has 13 hotels with a total of 3,830 rooms in Jerusalem, Tel Aviv, Eilat, Caesarea, Haifa and Ashkelon. The company started building a 230-room hotel in Bangalore, India at an investment of $70 million last year. (Yoram Gabison and Rina Rozenberg)

Mixed results on TASE

The Tel Aviv Stock Exchange finished the first day of the trading week with mixed results, as quiet prevailed in the south and Wall Street traded in stable territory over the weekend. The blue-chip Tel Aviv-25 Index lost 0.15% to close at 1,387 points, while the broader Tel Aviv-100 Index gained 0.1% to close at 1,240 points. The Banks-5 lost 1%, pulled down by Bank Hapoalim, which lost 1.65%, while the Real Estate-15 gained 0.6%. Total turnover was a relatively low 420 million shekels. Africa Israel Properties gained 4.5% after reporting a sharp increase in net profits in the first quarter, while Clal Biotechnologies lost 3.3% after the news broke that it was negotiating to sell Gamida Cell. (Dror Reich)