Business in Brief

Israel Chem shares rebound after Sheshinski; Delek asks to redeem bonds early as its trims pyramid; FIMI, Sky in talks for 50% stake in Zap Group; Zim valued at $860-890 million after bailout; Tel Aviv shares and bonds both advance.

Ofer Vaknin

Israel Chem shares rebound after Sheshinski

Israel Chemicals shares clawed back nearly all their losses on Monday, a day after the Sheshinski committee’s recommendations for a windfall profits tax pushed the stock down more than 2%. ICL ended up 2% at 31.23 shekels ($9.04). Gil Bashan, an analyst at IBI Israel Brokerage & Investments, said that, if adopted, the Sheshinski proposals would wipe out some $2 billion from ICL’s market capitalization, assuming the company’s tax liability would grow by as much as $170 million. But, he and Amir Adar of Meitav DS, noted, the market had already discounted the impact of Sheshinski, whose recommendations in any case wouldn’t go into effect until 2017. Adar had said he had expected ICL’s payments to the government would rise by about $135 million. (Yoram Gabison)

Delek asks to redeem bonds early as its trims pyramid

Delek Petroleum, a unit of Yitzhak Tshuva’s Delek Group, asked the Tel Aviv Magistrate’s Court on Monday to approve its redeeming some 132 million shekels ($38.2 million) bonds due in 2016 early. The petition comes as it moves the conglomerate brings itself into conformity with the Business Concentration Law, which requires groups structured as pyramids to slim down to no more than two tiers of companies. Delek plans to do away with the wholly owned unit, which controls businesses that own and operate in Israeli and U.S. energy businesses. The group has been divesting Delek USA in stages and will use part of the proceeds to repay the bonds at their current market value of 161 million shekels. Delek Group shares fell 0.6% to 1,475 shekels in Tel Aviv. (Eran Azran)

FIMI, Sky in talks for 50% stake in Zap Group

The private equity fund managers FIMI and Sky have been in talks to buy half of the Zap Group, formerly the phone book publisher Golden Pages, for between 80 million and 100 million shekels ($23.2 million and $34.6 million). The money would be invested on ZAP, not to buy shares owned by the group of institutional investors that have controlled ZAP since it underwent a debt restructuring. The institutions had initially considered selling their shares but after the Yad2 classified site was sold to Germany’s Axel Springer at an 806-million-shekel valuation, the institutions prefer to hold on to their stock in hopes of seeing an increase in Zap’s value, which for purposes of the negotiations is now put at 200 millions shekels. (Amir Teig and Michael Rochvarger)

Zim valued at $860-890 million after bailout

Zim Integrated Shipping Services, the indebted shipping unit of the Israel Corporation, should be worth somewhere between $860 million and $890 million when a bailout agreement for it has been completed, the Trigger Foresight consulting firm estimates. The valuation comes ahead of a June 23 meeting of Israel Corporation shareholders to approve the bailout, which calls for the company to inject $200 million in Zim, in which it will retain a 32% stake. The estimates assume that Zim’s freight business will grow 1.8% annually by volume and that a cost-cutting program equal to $565 million annually is put into effect. (Yoram Gabison)

Tel Aviv shares and bonds both advance

Tel Aviv shares rose Monday in light trading as bond prices extended their gains. The benchmark TA-25 index finished up 0.2% at 1,386.29 points while the TA-100 index rose 0.09% to 1,247.51 points. Turnover was 955 million shekels ($276.4 million). Kamada extended its losses of Sunday, when it plummeted 36% on news of a failed drug trial, closing down an additional 3.3% on Monday, to 29.14 shekels. Avgol also lost 3.3% to finish at 3.44 shekels. Among the gainers were companies connected with prospective sales to Chinese buyers. Mivtah Shamir, which owns a stake in food maker Tnuva, gained 1.8% to end at 127.40 shekels and Clal Insurance rose 1.8% to 69.05 shekels. Treasury officials said this week they won’t oppose the sales. The government’s 10-year shekel bond rose 0.25% to reduce its yield to 2.98%, while its inflation-linked bond due in 2023 added 0.17% to leave its yield at 0.8%. (Eran Azran)