Business in Brief / Discount Café Chain Cofix Makes Tel Aviv Stock Exchange Debut

Comverse buys U.K. company for price that could reach $210 million; RedHill shares rally on clinical trial success; Stratasys spins off customer-support unit.

A branch of the Cofix coffee chain, south Tel Aviv, January 2015. Less profit per sale, but more sales.
Ofer Vaknin

Discount café chain Cofix makes Tel Aviv Stock Exchange debut

The discount café chain Cofix made its Tel Aviv Stock Exchange debut on Monday, its shares ending up 1.7% for the day at 17.43 shekels ($4.54), trading as Agri Invest. Cofix entered the TASE by buying Agri, a shell company, and merging its operations into it. The company fomented a java revolution in Israel when it began operations two years ago, selling takeout coffee — and everything else on it menu — for just 5 shekels. It operates 70 stores, with 12 more in development, and two weeks ago launched its first supermarket with the same pricing policy. Although the business is growing fast, analysts say Cofix shares will likely suffer volatile trading as it is difficult to value the company, the only café chain listed on the TASE. In any case, the public’s share in the company is just 31.5% and its market cap just 21.5 million shekels, leaving few shares for investors to trade. Founder Avi Katz holds 32% of the stock and his daughter, deputy CEO Hagit Shinover, another 17.3%. (Eran Azran)

Comverse buys U.K. company for price that could reach $210 million

Comverse, the U.S.-Israeli maker of software for telecommunications operators, said Monday it was acquiring Acision, a British maker of secure mobile messaging services, for a price that could reach as much as $210 million. Comverse said it would pay $135 million in cash and 3.13 million in shares as well as make payments based on future performance that could add up to another $35 million. “Our acquisition of Acision underscores Comverse’s commitment to quickly building scale and market leadership in the fast-growing digital services sector,” CEO Philippe Tartavull said. The once high-flying company recently sold its billing-service unit to Amdocs for $272 million and set up a research and development center in Israel with India’s Tech Mahindra. Comverse also announced a $26.7 million loss for the first quarter ended April 30, up from $16.1 million a year earlier, as revenue dropped 29.6% to $45.7 million. Comverse shares were up 1.5% at $24.39 midday local time in New York. (Omri Zerachovitz)

RedHill shares rally on clinical trial success

Shares of RedHill Biopharma soared Monday after the company reported positive results for its Phase III study of a treatment of Helicobacter pylori, a bacterial infection that can lead to stomach cancer. The drug-development company said the study demonstrated 89.4% efficacy in eradicating the bacteria its RHB-105 drug. “RHB-105 should be well-positioned, if approved, for commercial success as a first-line therapy for the treatment of H. pylori infection,” said Gilead Raday, RedHill’s senior vice president for corporate and product development. Gastric cancer is the second most common cause of cancer deaths worldwide with some one million deaths annually, 95% caused by H. Pylori, RedHill said. It estimated the global market at $4.8 billion and the U.S. market at $1.45 billion. Shares of Redhill, which will now meet with U.S. Food and Drug Administration officials about a pathway to regulatory clearance, ended up 23% at 7.80 shekels ($2.03). (Yoram Gabison)

Stratasys spins off customer-support unit

Stratasys, the Israeli-U.S. maker of 3-D printing technology, said Monday it had spun off Bold Machines, its incubator unit for customers developing new applications for 3-D printing. Launched last year by Bre Pettis, founder of MarkerBot, a company Stratasys acquired in 2013, the unit has helped product designers with Bionic limb design and film-animation support. “It’s important to have entities such as Bold Machines to advance the adoption of 3D printing and make it more accessible,” said Stratasys CEO David Reis. No financial details were disclosed. Bold Machine will continue using Stratasys 3-D printers, including the PolyJet, Fortus, Solidscape and MakerBot product lines. Stratasys shares were down 0.3% at $35.21 l at midday local time in New York. (TheMarker)