Business in Brief: Populism and Legislation Are Pushing Israeli High-tech to Raise Capital Abroad, Says Offical

Teva to sell some of its U.S. generics to the Mayne Pharma Group of Australia; Hadera Paper giving employees options for a 1.84% stake in company; TASE rises, following the lead of overseas exchanges; Shagrir loses 28% in debut.

Stock prices flash on an electronic screen displaying world clocks at the Tel Aviv Stock Exchange (TASE) in Tel Aviv, Israel, on Thursday, Dec. 11, 2014.
Bloomberg

Hauser: Populism and legislation are pushing high-tech to raise capital abroad

Legislation and populism are inflicting harm on the Israeli high-tech sector, Israel Securities Authority chairman Shmuel Hauser said Tuesday, noting that in the past three years alone, Israeli technology firms with a collective market value of more than $30 billion had chosen to raise capital in the United States rather than Israel.

The same trend, he told a Tel Aviv financial technology conference sponsored by the Calcalist business daily, has also affected other companies that have looked to other sources of capital abroad through mergers and acquisitions and other foreign stock exchanges.

“Bureaucracy, populism, an anti-business atmosphere and laws are hurting the creative companies and the desire of entrepreneurs to work in Israel,” he said.

This requires regulatory agencies to change their approach and remove barriers in the financial sector as well, he added. (Shelly Appelberg)

Teva to sell some of its U.S. generics to the Mayne Pharma Group of Australia

Australia’s Mayne Pharma Group said Tuesday it would acquire certain U.S. generic products from Teva Pharmaceutical Industries for $652 million.

The deal is the latest of several large divestitures by Teva of U.S. assets, as required by regulators as a condition for approval of the company’s planned $40 billion acquisition of Allergan’s generic drug portfolio. Teva announced the Allergan deal last July.

Teva has also agreed to sell assets to Dr. Reddy’s Laboratories, Impax Laboratories, Sagent Pharmaceuticals and Cadila Healthcare, as well as to a number of private companies. In Europe, Teva is in the process of finding buyers for assets including its U.K. and Irish generics business, which is expected to be worth upwards of $1.3 billion, a source told Reuters. (Reuters)

Hadera Paper giving employees options for a 1.84% stake in company

As part of a renewal of its agreement with unionized employees, Hadera Paper is providing stock warrants which collectively provide for a 1.84% stake in the company to 250 of the company’s permanent plant workers (about half of the staff at the plant).

The final details are to be worked out by management and worker representatives, but in exchange for the warrants, the company’s unionized workers will forgo a portion of the pay increase that their current labor agreement provides. The terms of the warrants will be identical to those provided to senior Hadera Paper management.

The company expressed the hope that the new arrangements would create a greater commonality of interests with its workers. The new labor contract will run until June 2020.

The FIMI fund, First Israel Mezzanine, owns a 59.1% stake in Hadera Paper. (Yoram Gabison)

TASE rises, following the lead of overseas exchanges; Shagrir loses 28% in debut

Shares on the Tel Aviv Stock Exchange ended Tuesday’s trading generally higher against the backdrop of rising prices on markets abroad, a reversal overseas following the share price drops precipitated by Britain’s vote to leave the European Union.

The Tel Aviv 25 index was up 0.72% on the day to 1,392.25 points, while the broader Tel Aviv 100 index was up 0.69% to 1,204.31. Trading volume was 1.55 billion shekels ($399.7 million).

Shagrir Group Vehicle Services made its trading debut, but closed 27.69% lower at 5.86 shekels per share. Shagrir was spun off of another TASE company, Pointer Telelocation.

The Communications index surged 3.99% to 951.95 points, but bucking the overall positive trend, the Biomed index slumped by 0.44% to 429.87 points, dragged down by the declines at Mannkind, shares of which were off by 7.21% to 4.46 shekels and Kitov Pharmaceuticals Holdings, which closed at 0.75 shekels, off 7.33% on the day.

The Tel Bond 20, 40 and 60 indexes rose by roughly 0.2% to 0.3%. (Uri Tomer)