Business in Brief: Israel Chemicals Reportedly Eyes Haifa Chemicals in $1 Billion Deal

Two Africa Industries executives face indictment for false report ■ Tel Aviv shares lower as bond prices mark second day of sharp falls ■ Delek Group unit IDE agrees to sell Soreq A desalination plant to Dan Capital

Haifa Chemicals' ammonia tank, Israel's largest ammonia tank, is seen in the Haifa bay area, Israel, February 26, 2017.
REUTERS/Baz Ratner

Delek Group unit IDE agrees to sell Soreq A desalination plant to Dan Capital

IDE, the desalination company equaled owned by Delek Group and Alpha Partners, agreed over the weekend to sell its Soreq A plant to the infrastructure unit of the Dan bus company for between 530 million and 540 million shekels ($146 million-$149 million), Dan executives said on Sunday. The deal will clear the way for IDE to bid for a government contract to build and operate the even bigger Soreq B plant after the government’s Business Concentration Committee ruled last week that IDE couldn’t control both plants. Under the agreement, Dan Capital will buy both the plants and the rights to operate from IDE. The purchase will be second desalination plant for Dan Capital after it acquired after it agreed in June to buy a Netanya plant from Electra Limited for 100 million shekels, and will make the company a key player in the segment, executives said. Shares of Delek Group finished up 1.1% at 635.40 shekels. (Ora Coren) 

Wall Street Journal: Israel Chemicals eyes Haifa Chemicals in $1 billion deal

Israel Chemicals is in talks to buy Haifa Chemicals, a supplier of specialty fertilizers, for more than a $1 billion in cash and stock, The Wall Street Journal reported over the weekend. The cash component of the deal is expected to be around $600 million. the report said, citing unnamed sources.  ICL, which focuses on agriculture, food and engineered materials, has long been seen as a logical buyer for Haifa Chemicals, and the two firms have held merger discussions before, the Journal said. The deal could result in synergies approaching $100 million a year. ICL hadn’t responded in a Tel Aviv Stock Exchange announcement as on late Sunday. A Haifa Chemicals spokeswoman said that the company “there is nothing new regarding the ownership,” as no deal has been done. Haifa Chemicals is owned by a U.S. holding company by the Florida-based brother Jules and Eddie Trump. ICL shares ended up 0.9% at 22.90 shekels ($6.31). (TheMarker Staff)Israel Chemicals is in talks to buy Haifa Chemicals, a supplier of specialty fertilizers, for more than a $1 billion in cash and stock, The Wall Street Journal reported over the weekend. The cash component of the deal is expected to be around $600 million. the report said, citing unnamed sources.  ICL, which focuses on agriculture, food and engineered materials, has long been seen as a logical buyer for Haifa Chemicals, and the two firms have held merger discussions before, the Journal said. The deal could result in synergies approaching $100 million a year. ICL hadn’t responded in a Tel Aviv Stock Exchange announcement as on late Sunday. A Haifa Chemicals spokeswoman said that the company “there is nothing new regarding the ownership,” as no deal has been done. Haifa Chemicals is owned by a U.S. holding company by the Florida-based brother Jules and Eddie Trump. ICL shares ended up 0.9% at 22.90 shekels ($6.31). (TheMarker Staff)

U.S. REIT CMCT offers Israeli shareholders deal as it orchestrates strategy change

Less than a year after it issued some 800 million shekels ($220 million at current exchange rates) of preferred shares on the Tel Aviv Stock Exchange, CIM Commercial Trust Corporation is changing its business strategy and asking shareholders to swap their stock. The U.S. real estate investment trust, or REIT, controlled by Israelis Shaul Kuba and Avi Shemesh, raised the money from Israeli institutional investors in November 2017 with a plan to invest in U.S. office properties. Now CMCT wants to move into riskier assets, but holder of preferred shares have no voting rights that would give them a say in the decision. So in talks with institutions, the company is giving them the option of holding on to their preferred stock, swapping it for common stock or swapping them for a new class of preferred shares that the REIT could buy back starting two years from now. CMCT shares ended 0.7% higher at 96.68 shekels. (Michael Rochvarger)

Two Africa Industries executives face indictment for false reporting, fraud

Avi Motola and Avihu Ivshitz, the former CEO and chief financial officer, respectively, of Africa Industries, face an indictment subject to a hearing, the State Attorney’s office notified the pair on Sunday. Other former employees of the company, a unit of Africa Israel Investments, also face charges, prosecutors said. Motola and Ivshitz are accused of filing false financial reports, fraud, obstruction of justice and other violations during the years 2011-14 with the help of lower- level staff. Prosecutors allege that among other things they double-booked revenues and inflated inventories while Motola himself is alleged to have taken 1.2 million shekels in money for personal expenses.  When the two were left the company in 2015, their departures were ascribed to a 66 million shekel ($18.2 million at current exchange rates) loss Africa Industries posted the year before, but it later emerged the two were also under investigation and they were subsequently arrested by the Israel Securities Authority. (Jasmin Gueta)

Tel Aviv shares lower as bond prices mark second day of sharp falls

Tel Aviv shares ended lower Sunday as bond prices extended their losses under pressure from the U.S. market. The TA-35 index lost about 0.25% to end at 1,632.84 points, while the TA-125 dropped 0.35% to 1,475.14, on very low turnover of 373 million shekels ($103 million). Among big blue chip losers, TowerJazz dropped 4.4% to 74.63 shekels, Nice declined 1.7% to 407 and Teva Pharmaceuticals lost 1.5% to 78.45. It was if the fifth lower session in the last seven, leaving the drug maker down 11.3%. Among gainers, Perrigo added 1.5% to 259.50 and Bezeq 1.3% to 4.28. Volume leader Bank Leumi lost 0.4% to finish at 24. In the bond market, the government’s long-term, inflation-indexed bond ended down 0.49% and its unlinked long bond by 0.53%. The Tel Bond 20 index of corporate bonds lost 0.2% to 348.20 points. The yields on the benchmark U.S. Treasury bond rose to 5.3 basis points on Friday to 3.248%. (TheMarker Staff)