Business in Brief: Tamar Gas Field Sales Rose 25% in the Second Quarter

Bino gets official clearance to sell Paz stake on the stock market; TowerJazz leading growth among world’s semiconductor foundries.

Tamar
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Bino gets official clearance to sell Paz stake on the stock market

Zadik Bino won permission from the government on Wednesday to sell his 23% controlling stake in Paz Oil to the public. Bino faces a deadline under the Business Concentration Law to reduce his stake in either Paz or First International Bank of Israel, in which he has a 48% stake, to 5% by the end of 2019. Because Paz controls one of Israel’s two oil refineries, it is regarded as a strategic asset that needs government clearance to be sold. It is unclear whether Bino will opt to sell his stake, worth 1.5 billion shekels ($400 million), in the stock market or try to find a single buyer. The latter would likely put a higher value on Paz, but because of its “strategic asset” status finding a buyer will be difficult. Meanwhile, Paz reported a 34% drop in net profit in the second quarter to 161 million shekels. Paz shares ended down 2.7% at 616.60 shekels. (Michael Rochvarger)

Tamar gas field sales rose 25% in the second quarter

The partners of the Tamar natural gas field, Israel’s biggest in operation, took in a combined $434 million in revenues in the second quarter before paying royalties to the government, an increase of 25% from a year ago. Industry sources estimated the partners, which are led by Texas-based Noble Energy and Israel’s Delek Group, earned about $250 million in profits. The big gain in revenue was due to shrinking reliance on coal by Israel Electric Corporation, Tamar’s main customer, and the addition of new customers for its gas. That was offset partly by a 3.3% drop in the average price of natural gas, to $5.35 per mmbtu, although that is much higher than the $1.75 average in the United States. With reserves of about 310 billion cubic meters of gas and 13 million barrels of condensate, Tamar began production three years ago. The government’s stake in the quarter was $50 million, or 12% of revenues. (Eran Azran)

TowerJazz leading growth among world’s semiconductor foundries

Israel’s TowerJazz and China’s SMIC are forecast to display the highest sales growth in 2016 among the world’s top 10 pure-play foundries, IC Insights said in a report released Tuesday. With annual sales expected to rise 30%, TowerJazz  will edge out rival Powerchip for the fifth spot among so-called pure play semiconductor foundries — companies that make chips on order for other companies — albeit with just a 3% market share. “TowerJazz and SMIC have been on a very strong growth curve over the past few years. TowerJazz is expected to grow from $505 million in sales in 2013 to $1,245 million in 2016 (a 35% compounded annual growth),” the U.S. market-research firm said. Eight of the top 10 pure-play foundries are based in the Asia-Pacific region, with TowerJazz and U.S.-based Globalfoundries the only ones outside the region. TowerJazz shares ended up 0.3% at 58.29 shekels ($154.48). (Omri Zerachovitz)

TA-25 ends lower after four days of gains

The Tel Aviv Stock Exchange’s TA-25 index ended a four-day run of gains to close lower Wednesday. The blue-chip index finished 0.3% down at 1,467.88 points, while the TA-100 lost 0.2% to 1,293.62, as 1.05 billion shekels ($280 million) in shares changed hands. Mylan continued to be pressured over its EpiPen pricing policy in the United States, losing 1% to 172.60, and Opko Health fell 2.1% to 35.93. Middle East Tube soared more than 62% to close at 6.25 after it said it had sold land near Ramle for 389 million shekels. Perion Network finished up 7.8% to 5.10 amid reports that Ronen Shilo, a major shareholder, was seeking to oust its CEO citing five years of losses at the company. Energy stocks ran against the market trend, ending higher, with Isramco pacing gains in heavy trading. It ended up 1.5% at 75 agorot. Formula Systems led TA-100 shares higher with a 3.9% advance to 155.230 shekels. (Omri Zerachovitz)