Markets in Brief

Elbit Imaging sells U.S. shopping centers

Moti Zisser's company Elbit Imaging yesterday announced the sale of 46 U.S. shopping centers, out of a portfolio of 49, to the Blackstone Group buyout fund and to DDR Corp for $1.43 billion. The buyers are also assuming at least $945 million in debt. Blackstone unit Blackstone Real Estate Partners VII, is taking 95% of the acquisition, leaving 5% for DDR. IBI analyst Shay Lipman says he foresaw the exit, following his analysis of the company's debt last November and Elbit Imaging's sale of its holdings in fashion brand Gap Israel this week. The sale of the U.S. portfolio will net Elbit Imaging about NIS 430 million, he calculates, and brings the company the wherewithal to repay bondholders, at least during the year to come, he says. Investors in Tel Aviv applauded the move - Elbit Imaging stock gained 20.1% on heavy turnover of NIS 29 million. Bloomberg reports that Elbit Imaging's outstanding debt totals NIS 5.2 billion. Midroog has the company's debt at a Baa1 rating. (TheMarker)

Shlomo Rodav - Ofer Vaknin
Ofer Vaknin

Migdal may join Viola in buying Clal Industries

Migdal is negotiating to join private equity fund Viola's putative acquisition of Clal Industries from the IDB group, the insurance company said yesterday. Last week IDB announced negotiations to sell the company to Viola rather than to the Livnat family. IDB wants a premium of roughly 40% above the market value of the shares for the 34% interest it's selling. Tal Shirazli, head of equity research at Psagot, feels the price is merited. It's true that the market is evaluating the company on the low side, but it's a good company with broad diversification in holdings, he says. Clal Industries would suit Migdal's portfolio to a T, he feels. (Vadim Sviderski)

Azorim mulling NIS 100m bond offering

Housing developer Azorim is considering an NIS 100 million bond issue after the Israel Antitrust Authority blocked the sale of the Ir Yamim mall in Netanya. Azorim owns half the mall. Housing & Construction owns the other half. Azrieli Group was supposed to buy it for about NIS 700 million but, following the antitrust ruling, Azrieli withdrew its offer. Azorim needs cash to repay NIS 140 million to series 7 bondholders this March. (The rest of its bond debt, totaling NIS 515 million, comes due over the next five years in equal annual payments. Azorim also owes the banks NIS 712 million, and at present has NIS 418 million in cash plus property assets worth about NIS 1.1 billion. ) Following news that the Ir Yamim sale had fallen through, yields on its series 7 and 8 bonds jumped to 17%, deep in junk territory, attesting that investors have little faith in the company's ability to pay. (Oren Freund )

Bino hits pay dirt

The Paz Oil board of directors yesterday approved the pay package for its chairman and controlling shareholder Zadik Bino: NIS 175,000 a month in gross terms, plus value added tax (it doesn't pay him directly as an employee, it pays his company for "management services" ). The package for Bino, who has chaired Paz since 1994 and owns a 46% controlling interest in the company, is for a 90% position. It will remain in force for three years. He also gets a company cell phone and a car, as well as reimbursement of various other business expenses. (Shelly Appelberg)

Tower jumped day before Needham show

Chipmaker TowerJazz leaped 10% in midday trading in Tel Aviv yesterday. (Yet it closed with a mere gain of 1.4%, albeit on heavy turnover of NIS 12 million. ) The reason for the leap was apparently speculation in Israeli technology stocks before the 14th Annual Needham Growth Conference on Tuesday, at which TowerJazz chief executive Russell Ellwanger gave a presentation. He discussed the company's partnership with CMT Medical Technologies, and divulged information on a big deal with an unnamed buyer. Other Israeli tech stocks that jumped apparently in connection with the Needham conference include Allot Communication and EZchip, according to Bloomberg. (Vadim Sviderski)

Psagot starts Mellanox with Hold rating

Psagot has started coverage of Mellanox with a Hold rating and a target price of $35. Mellanox, which operates in the semiconductors niche of products to connect between servers, has been growing by about 40% a year on average, says Psagot. Its gross profit margins have been wide, at a fraction under 70%. Mellanox's products are based on InfiniBand and Ethernet communication protocols. The bottom line is that analyst Aviad Shimon feels Mellanox is innovative and a leader in the niche of InfiniBand technology for businesses. It's been gaining momentum and establishing itself as an alternative to competing technologies. The long-term trends look good, says Shimon, but economic slowdown could hurt growth in the short-term. (TheMarker)

Iran blocking text messages containing the word 'dollar'?

Iranians were taken aback yesterday morning to discover that cellular text messages containing the word "dollar" were not getting through. Newspapers reported on the problem of the ostensibly blocked text messages, saying officials had denied filtering. Reuters' calls to officials went unanswered. Iran's rial has depreciated by 20% against the currency of the "Great Satan" in the past week, despite central bank intervention. Inflation is reportedly running at about 20%, leading to a flight to other currencies. By Tuesday the U.S. dollar-rial exchange rate had risen again to around 17,000 rials, according to exchange bureaus - 50% more than the CBI's "reference rate" of 11,240 rials. The next day the Central Bank of Iran reportedly pumped $200 million dollars into the market. (Reuters and TheMarker)