The Ticker: Tel Aviv Shares Jump, Boosted by Plan to Trim VAT

Novocure eyes $300 million Nasdaq IPO; Clal Insurance eyes builder's infrastructure portfolio; Israir swings to Q2 operating profit.

At the entrance to the Tel Aviv Stock Exchange, 2011.
Bloomberg

Tel Aviv stocks rose sharply Wednesday, buoyed by Finance Minister Moshe’s Kahlon’s plan to cut the value-added tax to 17% from 18%. The jump followed two down days and was supported by a surge in energy stocks. The benchmark TA-25 index climbed 1.87% to 1,592.33 points, while the TA-100 rose 1.56% to 1,392.29. Volume was 1.26 billion shekels ($322 million). A correction in energy shares saw the Oil and Gas index jump 5.7%. Shares of Ratio Oil Exploration, Delek Drilling and Avner Oil Exploration rose by as much as 8.2%. Energy shares got a boost near the end of the day when Reuters quoted Egypt’s energy minister as saying Egyptian companies’ talks on importing Israeli gas would not be halted despite indications of a massive gas find off Egypt. Among big gainers outside the energy sector, Tower Semiconductor jumped 6.8%. (Eran Azran)

Novocure submits draft prospectus for $300 million Nasdaq IPO
Novocure, whose technology treats brain tumors, has filed a draft prospectus for an initial public offering to raise $300 million on the Nasdaq. The company, which has a research center in Haifa and U.S. offices in New York and Portsmouth, New Hampshire, has enlisted JP Morgan, Deutsche Bank and Evercore as its lead underwriters. Novocore aims to make its electrical device a complement to standard malignant brain tumor treatment. Its initial device was approved by the U.S. Food and Drug Administration in 2011. The company has accumulated losses of $329 million and has cash on hand of $106 million. Its major shareholders include WFD Ventures, which has nearly a 30% stake. CEO Asaf Danziger owns 2.7%. (Yoram Gabison)

Clal Insurance eyes Shikun & Binui's infrastructure portfolio
Clal Insurance is in talks to buy a 49% stake in franchise rights in parts of Shikun & Binui's Israeli infrastructure and real estate portfolio. The projects include Shikun & Binui’s half interest in the Carmel tunnel toll road in Haifa and a 50% stake in a desalination plant in Hadera. If a deal as done, the price tag is expected to be as high as 750 million shekels ($190 million). The transaction, projected to deliver a 7.5%-to-8% return over a 20 years, could trigger several hundred million shekels of profit for Shikun & Binui. The company is thought to be interested in raising cash for new projects in the United States and South America and may also seek to sell its interest in dormitories on the Tel Aviv University campus. These buildings are held by the subsidiary Shikun & Binui Real Estate. (Michael Rochvarger)

Israir swings to Q2 operating profit as passenger levels climb
A sharp increase in passenger volumes and a drop in fuel costs gave Israir a 1.3-million-shekel ($331,000) operating profit in the second quarter, following a 2.3-million-shekel loss for the same period last year. Still, the company, part of IDB Tourism, saw its net loss widen to 6.4 million shekels from 5.8 million. This time around, a lawsuit settlement was partly to blame. Second-quarter revenues at Israir, which flies international routes and a line between Tel Aviv and Eilat, eased 1.2% to 197 million, though partly because of the timing of Passover and because the carrier didn’t ply its Berlin route during the quarter this year. (Yoram Gabison)