Business in Brief: Tax Chief Opposes Reduction in Israel’s Capital Gains Tax

PepsiCo’s SodaStream delists ■ Matomy shares soar on rescue plan ■ supermarket mogul agrees to cut his compensation

Traders working on the floor of the New York Stock Exchange, December 4, 2018.
Spencer Platt/Getty Images/AFP

Tax chief opposes reduction in Israel’s capital gains tax

Eran Yaakov, the head of the Israel Tax Authority, said Wednesday he is opposed to reducing the capital gains tax. “You have to decide whether you want to give preference to someone investing in the stock market over someone who works and pays a rate of 47% on his income,” Yaacov told a conference on taxation and the capital markets. “If we were in an environment where capital gains taxes were higher, it would be a different story.” He was responding to a call for lower capital gains tax by Science Minister Ofir Akunis, who said it would encourage more stock market investment. Yaacov pointed to figures from the Organization for Economic Cooperation and Development showing that Israel’s 25% capital gains tax is near the weighted average of 23% for member countries. Yaacov said he supported ending the 5,000 shekel ($1,340) a month exemption on taxes on income from apartment rentals, saying it encouraged tax evasion. (Avi Waksman)

SodaStream ends Tel Aviv trading as PepsiCo completes acquisition

SodaStream said goodbye to the Tel Aviv Stock Exchange (and the Nasdaq) on Wednesday after PepsiCo completed its $3.2 billion acquisition of the maker of home carbonated drink machines. The last day of trading in SodaStream shares was Tuesday, and they were removed from TASE indexes Wednesday. SodaStream delivered impressive returns for investors, with its stock climbing nearly nine times in the three years of its TASE listing. SodaStream had marketed itself as a more environmentally friendly and healthier alterative to brands like Coca-Cola and Pepsi. That and PepsiCo’s desire to diversify out of its core brand led to the acquistion. “With its customizable options, SodaStream empowers consumers to personalize their preferred beverage in an environmentally friendly way and provides PepsiCo with a significant presence in the at-home marketplace,” PepsiCo CEO Ramon Laguarta said, marking completion of the acquisition. (Guy Erez)

Matomy shares surge on proposed rescue plan

Matomy shares soared Wednesday after the financially troubled digital-advertising firm unveiled a plan to convince bondholders not to seek immediate repayment of their debt. Under the offer, which will be put to a bondholder vote in the coming days, Matomy shareholders will inject $10 million into the company. Major shareholders, which include the French advertising firm Publicis and hold a 55% stake in the company, have agreed to contribute funds, Matomy said. In addition, Matomy will negotiate new terms for it to buy the 10% stake it doesn’t own in Team Internet, with the aim of reducing the price. For their part, bondholders will be asked to agree to a delayed repayment to as late as 2022. They will not be asked to write off any of their debt. Matomy shares finished 28% higher at 35 agorot (9 cents). (Michael Rochvarger)

Pressed by investors, Rami Levy agrees to reduce his compensation

Under pressure from institutional investors, Rami Levy, the founder and controlling shareholder of the publicly traded supermarket chain named after him, agreed Wednesday to take considerably less compensation over the next three years. Under the proposed terms, Levy – or more exactly his privately controlled management company – will be paid a share of the pretax profits on a sliding scale ranging from 0.67% to 2%, half the rate he sought. In addition, the combined rent the chain will pay his private companies for stores will not exceed 7% of the chain’s sales and marketing and management costs for the year, rather than 8%, Lower rates will prevail on rents for other properties like warehouses and logistics centers. A shareholder meeting to approve the new employment contract has been delayed by three days to December 12. Rami Levy shares ended down 0.05% at 189.50 shekels ($50.83). (Yoram Gabison)

Tel Aviv stocks finish higher in heavy trading

Tel Aviv shares finished higher on Wednesday in heavy trading. The benchmark TA-35 index rose 0.35% to end at 1,637.51 points, while the TA-125 added almost 0.6% to 1,480.55, on turnover of 1.65 billion shekels ($440 million). Trading was heavier than usual as exchange-traded funds bought TA-35 and TA-125 component shares to make up for SodaStream’s delisting Wednesday. Among blue-chip gainers, Israel Chemicals rose 1.8% to end at 21.59 shekels and Nice climbed 1.3% to 437. Teva Pharmaceutical Industries dropped 1.7% to 78. Bank shares were mostly lower, paced by losses of 1.2% to 24.29 for Leumi and 1.1% to 24.675 for Hapoalim. Bezeq group shares continued to slide, with Bezeq ending down 1.5% at 4.01 and B Communications losing 2.8% to 28.39. Ham-Let led TA-125 stocks higher, adding 4.6% to 76.30. Opko Health dropped 4.5% to 13.50. In foreign currency trading, the euro slid nearly 0.55% to a representative rate of 4.2289 shekels. (TheMarker Staff)