Business in Brief: Insiders Bought Shares Amid Sunday's Market Drop

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FILE PHOTO: The Tel Aviv Stock Exchange, August, 4, 2016.
FILE PHOTO: The Tel Aviv Stock Exchange, August, 4, 2016.Credit: Bloomberg

U.K.-based billionaire Teddy Sagi among bidders for Israir

The U.K.-based Israeli billionaire Teddy Sagi is among 20 potential bidders for the Israeli airline Israir, whose parent company, IDB Tourism, is being sold by Eduardo Elsztain’s IDB Development Ltd. Other bidders are the hotel and real estate entrepreneur Meni Weitzman; Elco Holdings; and a host of hotel and tourism companies. IDB expects to begin negotiations with the top two or three bidders by the end of January. In its third-quarter financial report, IDB said it expected to fetch about 225 million shekels ($59.7 million) for Israir, which has fared better than its bigger rival, El Al Airlines, in the more competitive travel market that has emerged in recent years. Sources close to the deal said they expect the carrier is likely to fetch more, with bids currently in the $60 million to $70 million range. IDB needs to sell Israir to help repay 937 million shekels due to bondholders during 2019. (Michael Rochvarger and Yoram Gabison)

Migdal chairman says he’s quitting over failure to make strategic changes

After just 10 months in the job, Prof. Oded Sarig announced on Monday he was stepping down as chairman of Migdal, one of Israel’s biggest insurance companies, saying his plans for a strategic overhaul had been frustrated. “Migal Insurance operates based on short-term considerations without a defined plan and by sticking to old routines,” a statement to the Tel Aviv Stock Exchange by the company said, explaining Sarig’s decision. “On account of this, Migdal’s chairman explained that he could no longer act for the good of Migdal and its clients as he is required to.” Sarig attributed his inability to effect changes to structure and governance issues at the company, which is controlled by Shlomo Eliahu. In response, the Capital Markets Authority said it was following developments at Migdal closely to ensure “proper management.” Sarig said he would stay on until a successor is named. Midgal shares finished down 6.55% at 3.28 shekels (87 cents). (Eran Azran)

FIMI sells G1 shares in IPO after cutting valuation amid Sunday’s market drop

Despite the sharp drop in the market, FIMI Opportunity Funds succeeded on Sunday in selling shares in an initial public offering to institutional investors in the security service company G1. But to enable the sale to go through, the private equity fund cut the valuation of G1 to just 450 million shekels ($119.4 million) from a maximum originally sought of 550 million. FIMI also abandoned the plan to sell the shares by auction and sold them at a single price of 5.66 shekels each. The institutional tranche of the IPO sold for 150 million shekels and the public tranche, which was scheduled for Monday, was expected to raise another 40 million shekels. Once part of the global G4S security provider, it was sold — reportedly under pressure from the BDS movement — to FIMI last year. G1 provides security services for business and government customers and related services. The IPO was the 15th for FIMI on the Tel Aviv Stock Exchange.  (Yoram Gabison)

Orbotech shares dip on news KLA-Tencor acquisition is being held up by the Chinese

Shares of Orbotech, the Israeli maker of electronics manufacturing equipment, fell on Monday on news that its acquisition by KLA-Tencor would take longer than expected as the two sides await approval from Chinese antitrust authorities. The companies had originally expected all the approvals to be in place by the end of this year. “KLA-Tencor continues to have advanced discussions with the State Administration for Market Regulation of the People’s Republic of China regarding clearance of the proposed merger involving KLA-Tencor and Orbotech with a goal of obtaining clearance as soon as practicable in 2019,” the two companies said in a joint statement. The U.S. company agreed last March to buy Orbotech for what was then $3.4 billion in cash and stock, a figure that has since fallen because KLA-Tencor’s share price has declined. Orbotech, which derived 41% of its sales from China last year, was down 5.3% at $51.79 in the early afternoon local time in New York. (Yoram Gabison)

Insiders bought shares amid Sunday market swoon

In a vote of confidence in their companies and the market, insider shareholders took advantage of Sunday’s big drop on the Tel Aviv Stock Exchange to buy shares. In addition, companies bought back shares. Among the biggest buyers was Oded Feller, who bought all the 5.8 million shekels ($1.5 million) of stock sold on Sunday in his Emilia Development. The purchases boosted his stake by nearly one percentage point to 83.25%. Igal Dimri, controlling shareholder of the construction company Dimri, bought 500,000 shekels’ worth of company stock, increasing his stake to 67.07% while Hanan Mor bought 300,000 shekels of shares in his eponymously named construction group as well as some 200,000 shekels of the company’s Series Het bonds as their yields climbed to nearly 10%. Among companies buying back shares, Eduardo Elsztein’s Discount Investment Corporation bought 3.3 million shekels of its own shares and Yitzhak’s Tshuva’s Delek Group bought 2.4 million. (Eran Azran)

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