Business in Brief: Bank of Israel Intervention Lifts Dollar Off Low

ICL in pact with Leviev to develop Namibian phosphate operation; Mega sells last of its You supermarkets to two rivals; Oil price slide brings down share prices.

Yoram Gabison
Eran Azran
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Israeli shekels are worth more in euro or dollar terms than for many years.Credit: Reuters
Yoram Gabison
Eran Azran

Bank of Israel intervention lifts dollar off low

The Bank of Israel intervened in foreign currency trading again on Monday, buying an estimated $150 million to $250 million in two rounds. The bank acted after the greenback sank to 3.8375 shekels and enabled it to recover to a Bank of Israel rate of 3.855, a loss of only 0.05% for the day. In late trading, the dollar made further gains and was at 3.873. The euro weakened 0.7% to 4.1660 and was trading late in the day at 4.1979. Currency trader FXCM said the weakening of the dollar was the result not of negative sentiment but rather the European Central Bank’s decision last week to cut deposit rates and expand quantitative easing. “The level of 3.80 shekels constitutes strong support for blocking further declines, but if it does break through it is likely to lead to a sharp drop,” FXCM said. (Eran Azran)

Europe upholds Teva patent

Teva Pharmaceutical Industries won a key legal victory yesterday after the European Patent Office upheld the validity of a patent the Israeli drug maker had filed for the new version of its Copaxone multiple sclerosis treatment. The EPO ruling means the patent on a version of the drug that users take only three times a week will not expire until 2030. (Yoram Gabison)

ICL in pact with Leviev to develop Namibian phosphate operation 

Israel Chemicals said Monday it had signed a memorandum of understanding with the Lev Leviev holding company to conduct a feasibility study into establishing a phosphates project, extracting the mineral offshore Namibia and developing a downstream production business. “The cost of extracting the phosphate is anticipated to be very competitive compared to competitors,” ICL said. Over the next few months, ICL said it would work with the Leviev subsidiary LLNP to complete the technology development needed to produce downstream products from marine deposits, including building a pilot plant at a cost of up to $50 million. LLNP holds permits and exploration rights to mine phosphate deposits estimated at around one billion metric tons.  If the project goes ahead, ICL estimated it would cost $1 billion and begin production no earlier than 2022. ICL shares ended down 1% at 18.43 shekels ($4.76). (Yoram Gabison) 

Mega sells last of its You supermarkets to two rivals

The ailing supermarket chain Mega divested the last of its You discount supermarkets on Sunday, selling four of the stores to Rami Levy and two to Machsanei Hashuk. Rami Levy, the biggest of the discount supermarket chains that have caused Mega so much trouble, paid 18 million shekels ($4.65 million) for the four supermarkets and Machsanei Hashuk paid 8 million shekels for its two outlets. The sales complete Mega’s exit from the discount format through its You sub-brand after it sold 16 other You stores over the weekend to the Victory and Yohananoff supermarket chains for a combined 95 million shekels. Mega will continue operating 114 stores under its flagship Mega in the City brand. Shares of Alon Blue Square, which controls 70% of Mega, ended down 3.2% at 1.26 shekels. (Yoram Gabison) 

Oil price slide brings down share prices

Tel Aviv shares ended broadly lower Monday as world oil prices slid. Brent crude prices dropped to $41.38 a barrel and U.S. crude fell to $38.15 a barrel, after OPEC’s meeting ended last week without a reference to its output ceiling. On the Tel Aviv Stock Exchange, the blue-chip TA-25 index fell 0.7% to end at 1,555.73 points while the TA-100 lost 0.6% to 1,34016, on turnover of 1.33 billion shekels ($340 million). Among the big losers, Supersol dropped 3.2% to close at 11.86 shekels after Mega completed the sale of its You supermarkets, heightening concerns about increased competition for Supersol. Frutarom finished 3.7% lower at 181.50 as did biotech company Mannkind, which closed at 7.13. In the fixed-income market, the government’s 10-year Shahar bond rose 0.16%$ to trim its yield to 2.20% while its index-linked bond for the same term advanced 0.23% to a yield of 0.66%. (Eran Azran)

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