Business in Brief: Court Decides Against Appointing Special Administrator for IDB Development

VBL shares drop after pricing of secondary offering; Delshah Capital’s bonds fall sharply; Shares end higher as dollar extends losses.

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.
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. Credit: Bloomberg

Court decides against appointing special administrator for IDB Development

IDB Development Corporation and its controlling shareholder emerged victorious in court on Tuesday after Judge Hagai Brenner convinced bondholders to drop their demand to appoint a special administrator for the conglomerate.

An administrator would have forced Eduardo Elsztain and the IDB board to cede some control over the indebted conglomerate. IDB’s Series Tet bondholders lost on another front as Brenner of the Tel Aviv District Court said a 400 million-shekel ($104million) payment due short-term bondholders should go ahead as scheduled June 10. Brenner said a hearing on the Series Tet bondholders’ petition for IDB Development to be liquidized will only begin in September.

In the meantime, Elsztain’s attorneys said it would seek to have the petition thrown out of court. A lawyer for the government’s Administrator General and Official Receiver told the court it didn’t regards IDB Development as insolvent. IDB shares rose 0.1% to 81 agorot. (Shelly Appelberg)

VBL shares drop after pricing of secondary offering

Shares of Vascular Biogenics, a Tel Aviv-based biotech company developing cancer treatments, dropped sharply on Tuesday after it priced a secondary offering of shares at $5.50 each.

The offering price was 20% below VBL’s closing price Monday after the shares had surged more than 70% on news that after the company presented positive Phase I/II clinical trial results for its VB-111 ovarian cancer treatment.

VBL said it was selling 4.36 million shares that will raise its $24 million and $22.2 million after fees to underwriters. VBL said it would be using the proceeds to advance its clinical programs as well as for working capital and other corporate purposes.

Founded as Medicard in 2003, VBL’s other drugs in development include VB-511, an anti-angiogenic candidate for oncology; and VB-211 and VB-411 for the treatment of peripheral vascular diseases.

VBS shares were trading down 13.7% at $5.91 late morning local time in New York. (Yoram Gabison)

Delshah Capital’s bonds fall sharply

Bonds for New York property developer Delshah Capital plunged in Tel Aviv Stock Exchange trading on Tuesday, echoing sell-offs over the last several weeks in bonds by Urbancorp and Extell, two other North American property companies whose debt trades on the TASE.

The price of Delshah’s Series Aleph bonds, which carry now collateral, dropped 9.3%, and those of its Series Bet bonds, which do, fell 3.5%, leaving both of them trading at junk levels.

There was no news reported by the company on Tuesday to explain the sudden sell-off, but sources said it would be linked to an announcement Delshah made Sunday that it was planning a $234 million deal to buy of five buildings from St. Luke’s Hospital in Manhattan and convert them to apartment buildings.

The deal would be quite large for a company whose assets now total just $550 million and furthermore it wouldn’t generate any income for Delshah before 2018, sources noted. Delshah issued 400 million shekels ($104 million) of bonds earlier this year. (Eran Azran)

Shares end higher as dollar extends losses

Tel Aviv shares ended moderate higher on Tuesday as the dollar extended its losses. The benchmark TA-25 index rose 0.15% to closer at 1,448.20 points, while the TA-100 edged 0.09% up to 1,2458.76, as just over 1 billion shekels ($x280million) in shekels changed hands.

Ability surged higher for a second day, leading TA-100 stocks on an 11.7% advance to close at 14.68 shekels. A day earlier the company said it was expecting major sales for a new surveillance product this year. Sapiens rose 1.8% to 47.09 after reporting it paid $6 million to buy a U.S. provider of insurance software.

Allot led TA-100 shares lower on a 3.1% drop to 19.53 while El Al Airlines lost 2.7% to 2.50 and Bank Hapoalim fell 1.6% to 19.21. In foreign currency trading, and the dollar weakened 0.3% to a Bank of Israel rate of 3.8180 shekels. In the fixed-income market, the government’s 10-year Galil inflation-lined bond rose 0.34% to a yield of 0.29%. (Omri Zerachovitz).

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