Daily Roundup / Hapoalim Execs Suffer Salary Slash

Weak yen is a plus for car importer; Azrieli patiently seeking Tambour buyer; watchdogs bark at bank boards to stay away from large investors.

Executive pay cut at Hapoalim: Executives will be suffering a roughly 10% cut in pay over the next five years, under the new collective wages agreement signed yesterday for that period of time by the board and union representatives. Note ye that the bank isn't cutting their pay now: what it's doing is abolishing automatic pay raises for top staffers, from the tank of branch manager up. If we assume that inflation averages 2% in the next five years, then their pay will erode by 10.4% in real terms. The affected group of people amounts to 10,000, each of whom earns tens of thousands of shekels a month. The bank didn't get into how much it expects to save on the move. But wipe your tears: Hapoalim is giving each worker a one-time bonus amounting to a month's pay. The board is showing solidarity by waving 5% of their pay.

Enfeebled yen boosts Israeli car importer: The implosion of the Japanese yen in the fourth quarter of 2012 did wonders for Delek Automotive, which posted NIS 172 million net profit for the quarter – an increase of 240% from the same period of 2011. Sales had increased by a rather lesser 10% year over year to NIS 871 million. Now, the company actually sold less cars compared with the fourth quarter of the year before, so how does this math work? Simple - it's sales mix. Delek Auto sold proportionally more pricey BMWs than it did last year, while sales of lower-cost Mazdas did less well. How much less well? Very much: year over year sales of the Japanese car tumbled 40% to 1,839 vehicles in the last quarter of 2012.

Medical Compression shares jump on product launch: Shares of Medical Compression System, which is developing noninvasive medical technology, rose 6% on huge turnover (for it) on Wednesday after the company launched its DTX+Care+Active. The new device, which is based on the company's flagship product S.F.T.+ActiveCare, combines treatment for deep-vein thrombosis (clots) with the ability to identify blood-flow obstructions in the legs, which could attest to clotting. The company will be presenting its new baby at the AAOS conference of orthopedic surgeons in the United States, March 22-23, and plans a U.S. launch in the second half of the year.

Bezeq board hires Stella Handler: As expected, the Bezeq board of directors has smiled upon hiring veteran telecoms manager Stella Handler as the phone company's new CEO, for its wireline activity. She will be replacing Avi Gabay, who is moving on after 15 years at the company, six as CEO. Handler, who has held top positions at rival Israeli companies including 012 Smile and HOT, was picked by Shaul Elovitch, who bought Bezeq two years ago.

Azrieli selling Tambour, but not in a rush: The Azrieli Group is asking half a billion shekels for the paints manufacturer Tambour, which it obtained as a subsidiary of the Granite Hacarmel group. Tambour was delisted a year ago and is recorded in Azrieli's books at a company value of NIS 407 million. The group isn't stressing for cash: it can patiently sit on Tambour until it gets the premium it wants, and there have been feelers.

Watchdogs keep an eye on bank boards: In a stab at cleaning up corporate governance, two key Israeli watchdogs joined paws and on Wednesday banned directors on bank boards from sitting on the boards of large institutional investors in parallel. The practice isn't rare and can create conflicts of interest, noted banks supervisor David Zaken and markets commissioner Oded Sarig. So, what is a big institutional investor? One with more than NIS 10 billion in assets under management. Israel has several of those. If they serve on parallel boards of relatively piddling companies, they can continue, the watchdogs allowed.

Leviathan has more gas than previously thought, says Noble: The results from a second appraisal well shows that the deep-water field Leviathan has more natural gas than previously thought, said Texas-based Noble Energy on Wednesday. Noble, which is developing the prospect together with the Israeli group Delek, said the Leviathan #4 appraisal well was drilled to a total depth of 16,992 feet and encountered 454 net feet of natural gas pay in multiple intervals. That is the thickest net pay of any well drilled to date at Leviathan, the company said. It increased its estimate for gross recoverable gas in the field from 10 to 18 trillion cubic feet (range 15-21 Tcf). Noble has a 37% interest in Leviathan; Delek Drilling and Avner (both Delek companies) have 22.7% each and Ratio Oil has 15%. (Haaretz)

Bondholders choose chairman for Ampal: Not that it's their position to do so yet, but the bondholders of Ampal-Israel have selected a chairman for the beleaguered company, one Moshe Ingber, formerly a top credit officer at Bank Leumi. The rub is that Yossi Maiman, controlling shareholder, CEO, chairman and president of Ampal, refuses to quit (say the bondholders), but come the day, if it does, bondholders will be ready. They're owed about NIS 900 million. The expectation in market circles is that if needed, the New York district court will smile on the bondholders' choice. Rub No. 2 is that the day may not come. Possible positive developments in Ampal's Colombian ethanol project and the company's lawsuit against EMG could leave Maiman's stake and seat intact.

With reporting by Yoram Gabison and Oren Freund

Tomer Appelbaum
Ofer Vaknin