Tycoons Sold 5.5 Billion Shekels of Shares in 2014

Qoros' car sales jumped in fourth quarter; Moody's cuts Discount's deposit rating; Somoto tumbles on Apple clarifications.

Rami Shllush

Tycoons sold 5.5 billion shekels of shares in 2014

Controlling shareholders sold some 5.5 billion shekels ($1.4 billion) of shares during 2014, marking a second year of big sell-offs after they unloaded 6 billion in 20013, figures from the Tel Aviv Stock Exchange released yesterday showed. As a result, the public’s combined shareholding in TASE-listed companies rose to 61% at the end of last year, from 58% at the end of 2013. The biggest sales were by Matthew Bronfman and Rubin Schron, who sold 1.1 billion shekels in Israel Discount Bank shares as part of their strategy of exiting the bank they controlled for a decade. Another big seller was Shlomo Eliahu, who sold his remaining Bank Leumi shares for 590 million shekels as a condition for gaining control of Migdal Insurance & Finance. No. 3 on the list was Zadik Bino, who sold 260 million shekels of Paz Oil shares and 200 million shekels shares in FIBI, the parent company of First international Bank of Israel. Major shareholders are under pressure to divest holdings as the government seeks to break the power of the big holding groups. (Dror Reich)

Qoros’ car sales jumped in fourth quarter

Shares of Kenon Holdings rose 1% to close at 67.65 shekels ($17.16) yesterday, after its Qoros auto-making joint venture in China reported that sales rose 35% in the final quarter of last year from the third quarter. Although sales amounted to just 2,547 units and were 15% less than the company projected, the increase is likely to reduce the amount of cash shareholders or others will have to inject into the venture, which is owned 50/50 with China’s Chery Automobile Company. Since its 2011 launch, Qoros has failed to meet sales expectations, capturing just 0.03% of the Chinese automobile market last year, forcing Gua Qian to step down as its chairman and CEO in December. Qoros will need some $200 million in capital by the end of the current quarter, according to the company’s own estimates. Kenon has said it prefers Qoros to raise any further cash it needs on its own, rather than further injections by shareholders. (Yoram Gabison)

Moody’s cuts Discount’s deposit rating

Moody’s Investors Service on Thursday downgraded Israel Discount Bank’s long-term deposit ratings to Baa1, from A3, and its baseline credit assessment to ba1, from baa3. The credit rating agency said the bank’s deposit ratings maintain a negative outlook. Moody’s said the downgrade, which relates to the bank’s ability to meet obligations to depositors, was due to concerns about the bank’s high-cost base and low-growth prospects, both of which are pressuring the bank’s ability to generate earnings. It said Discount plans to cut costs to help improve earnings, but noted, that “challenging operating conditions will, in Moody’s view, prevent a more significant improvement.” Discount shares fell 0.2% to end at 6.22 shekels ($1.59). (Sivan Aizescu)

Somoto tumbles on Apple clarifications

Somoto shares tumbled more than 50% yesterday after it clarified the reasons Apple was ending its contractual relationship with its Genieo Solution unit. Somoto said the U.S. tech company cited high levels of user complaints about Genieo’s Omnibar application, which turns Mac users’ homepage into a virtual newspaper with custom news. The statement came at the behest of the stock exchange, which demanded Somoto provide more information on Apple’s move than it did initially last Thursday. Somoto said Apple accounted for 25% of its 2014 revenue, but stressed that, even without a contract, it would continue to see revenues from its installed base in 2015, and that other Genieo tools were not affected by the Apple decision. Somoto shares closed at 1.55 shekels (40 cents). (Eran Azran)

TA-25 ends higher in generally down market

The Tel Aviv Stock Exchange’s TA-25 index ended higher yesterday, even as most of the market was down as blue chips eked out gains. The benchmark index finished up 0.25% at 1,466.94 points, while the TA-100 edged up 0.04% to 1,282.53, on turnover of 474 million shekels ($121 million). Bank Leumi and Bank Hapoalim both closed up 0.5%, at 13.42 and 17.99 shekels, respectively, while Teva Pharmaceuticals rose 0.5% to 227.50 and Bezeq added 0.7% to 6.71. Cellphone stocks continued in freefall – Cellcom Israel down 7% to 22.20 and Partner Communications losing 5.4% to 13.23. Concerns about the collapse of the share prices of its Cellcom and Supersol units caused Discount Investment Corporations to plunge 10%, to close at 6.04. (Omri Zerachovitz)