Business in Brief: Electra Consumer Completes Golan Telecom Acquisition After Last-minute Snags

Isramco board approves massive dividend payout through 2019; Court orders IDB to sell first 5% block of Clal Insurance shares; Sovereign wealth fund to launch in 2020, Bank of Israel chief says; Tel Aviv Stock Exchange snaps five-session losing streak

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.
Bloomberg

Electra Consumer completes Golan Telecom acquisition after last-minute snags

Electra Consumer Products completed its acquisition of Golan Telecom on Wednesday, overcoming a last-minute squabble over price. Electra said the acquisition went through at the 350-million-shekel ($95.9 million) price tag the two sides agreed in January, even though Electra had sought to lower that after regulators attached conditions to approving the deal, including a commitment to offer low-cost packages to users for a fixed period. The deal ends a nearly five-year run in Israel’s cellular market for French entrepreneur Michael Golan and his partners, where they played the part of market upstart with simple, low-cost plans. As an operator of consumer-electronics stores and importer of Huawei smartphones, Electra says it hopes to build on synergies between its businesses and Golan’s. “We have no doubt the joint strengths will restore Golan to growth and enable it to expand to new areas,” said Electra CEO Zeev Kalimi. Electra shares ended 0.4% up at 78.14 shekels. (Amitai Ziv)

Isramco board approves massive dividend payout through 2019

The board of Isramco, the oil and gas partnership that controls 28.8% of the Tamar gas field, voted Wednesday to pay a giant $1.2 billion in dividends between now and the end of 2019. Directors approved a $427-million payout for 2017 – amounting to all the partnership’s accumulated profits – while at the same time clearing plans for a $450-million bond sale. The dividend policy for the following years calls for distributing nearly all of Isramco’s annual earnings from the Tamar gas field, which amount to $300 million annually, or a total of $1.2 billion during 2017-19, an amount equal to more than half Isramco’s TASE market capitalization. With just $325 million debt on its books, Isramco is now highly leveraged and can afford to take on more debt, sources in the company said. Isramco shares shot up 6.2% to 67 agorot (18 cents) in heavy trading. (Eran Azran)

Court orders IDB to sell first 5% block of Clal Insurance shares

Tel Aviv District Court on Wednesday ordered IDB Development Corporation to sell a 5% block of shares in its Clal Insurance unit in the stock market, as ordered by capital markets chief Dorit Salinger. IDB, a holding company controlled by Argentina’s Eduardo Elsztain, had been resisting Salinger’s directive to divest its 55% stake in Clal, hoping instead to find a single buyer for the shares at a higher valuation. Judge Ruth Ronnen ordered Moshe Teri, who controls the shares as a trustee, to sell the block within 30 days and said IDB and Salinger should negotiate terms for further sales over the next four months. IDB, whose precarious finances make it impossible to hold an insurance license, may appeal Ronnen’s decision. In any case, Clal shares ended down 2.2% at 57.10 shekels ($15.64), in expectation that the court-ordered sales would create a glut of Clal shares on the market. (Michael Rochvarger and Assa Sasson)

Sovereign wealth fund to launch in 2020, Bank of Israel chief says

Israel’s sovereign wealth fund, meant to safeguard billions of dollars in natural gas revenue, will begin operating in about three years, Bank of Israel Governor Karnit Flug said on Tuesday. "Our estimate, based on current prices ... is that the fund will start to operate around the year 2020,” Flug told the National Energy Conference in Tel Aviv. At that point, she said, tax receipts that will have been deposited in the fund will reach around 1 billion shekels ($274 million). The central bank is overseeing establishment of the fund, which will be invested abroad to avoid a major influx of foreign currencies that could strengthen the shekel and undermine export industries. Income from the fund will be used for national projects, emergencies and other designated uses. The fund is collecting funds from the Tamar gas field, which began production in 2013, and will grow more quickly after the much larger Leviathan field comes online in late 2019. (Reuters)

Tel Aviv Stock Exchange snaps five-session losing streak

The Tel Aviv Stock Exchange snapped a five-session losing streak Wednesday to end sharply higher, led by energy and banking shares. The TA-35 and TA-125 indices both closed 1.1% up at 1,409.90 and 1,268.18 points, respectively, as some 1.32 billion shekels ($360 million) in shares changed hands. Among the biggest gainers, Property & Building Limited jumped 6.7% to 351.90 shekels after HSBC said it was extending the lease on one of the firm’s key New York properties. Banking shares rose, paced by gains of 2.2% for Israel Discount to 8.79 and 1.5% for Leumi to 16.15. Brack Capital traded unusually heavily, rising 1.8% to end at 353.80. Mazor Robotics sunk 5.7% to 52.12, even though it forecast record sales of $11.5 million for the first quarter. Alon Blue Square raised 218 million shekels in the institutional tranche of a bond offering, at a yield of 3.65%. In foreign currency trading, the euro posted a 0.5% advance to a Bank of Israel rate of 3.9007 shekels. (Omri Zerachovitz)