Business in Brief: Trump China Tariff Delay Lifts Tel Aviv Shares

TASE getting another medical marijuana firm ■ Secondary bourse could begin in 2020 ■ Warburg brings in three partners as it completes acquisition of Leumi Card ■ Securities Authority to focus on making Israeli market more attractive to investors

File photo: A man looks back as he monitors the stock prices at a brokerage house in Beijing, China, January 9, 2019.
Andy Wong/AP

Warburg brings in three partners as it completes acquisition of Leumi Card

U.S. private equity firm Warburg Pincus said on Monday it was bringing in three strategic partners as it completed its acquisition of Bank Leumi’s credit card business on Monday. The New York-based private equity firm said Menora, Clal Insurance and Allied Group would each hold a 5% stake in Leumi Card and, in the case, of Menora and Clal, would double their stakes once they get regulatory approval. “The fund sees great importance in the inclusion of key Israeli partners in the investment, and therefore chose some of the leading financial entities in the Israeli market,” Warburg Pincus, which has more than $43 billion in private equity assets under management, said in a statement. Leumi Card will rebrand and change its name to Max, it said. Leumi sold its 80% stake in Leumi Card, and property developer Azrieli Group its 20%, to Warburg Pincus for 2.5 billion shekels ($700 million) in an agreement reached in July. (Assa Sasson and Michael Rochvarger)

Securities Authority to focus on making Israeli market more attractive to investors

The Israel Securities Authority aims to make the capital market more attractive to investors as part of its 2019-22 strategic plan, chairwoman Anat Guetta said on Monday. She said the Tel Aviv Stock Exchange had seen the number of listings fall in recent years, which she attributed in part to excessive regulation. “If [investors] are forced to go overseas because there is enough merchandise then that’s a problem,” she told a news conference. “We need to work to open the local capital market to the world, to expand it and turn it into a high-tech, advanced and competitive capital market,” she said. Guetta vowed that the ISA would not slacken enforcement. “Even as I speak, our investigators are working on cleaning up the market,” she said. “I will not say a word about it, but I will just mention the words of former President Roosevelt, ‘Speak softly and carry a big stick.’” (Jenya Volinsky)

TASE getting another medical marijuana firm 

The Tel Aviv Stock Exchange is getting another medical cannabis company. PTL Financial, a listed shell company, said it had reached a nonbinding merger agreement with Ilan Bio, an Israeli agrotechnology company that has been operating a wholly owned medical marijuana subsidiary in California since last March. Ilan Bio’s Agripharma unit extracts oils from the cannabis plant and manufactures a variety of products from it, PTL said. Agripharma had sales of just $2.5 million last year, but it plans to expand operations significantly using Ilan Bio’s proprietary in vitro plant propagation and cloning technologies. The merger calls for PTL to give Ilan Bio shareholders a 71.1% stake in the company, which has 17.5 million shekels ($4.85 million) in cash on its books. After the merger is completed, PTL will either make a public offering of shares of at least 5.5 million shekels or boost Ilan Bio’s stake to 74.9%. PTL shares closed up 76.1% at 76 agorot. (Guy Erez)

Secondary bourse could begin in 2020

Israel’s securities regulator said on Monday that a new secondary market to cater to small and medium-sized businesses could be ready by the end of next year. The new market could begin operating by “the middle to end of 2020,” Anat Guetta, chairwoman of the Israel Securities Authority, said, admitting that meeting the deadline “would be a challenge.” Part of the uncertainty about the timing is because the move requires new legislation, which the Knesset has yet to complete. The secondary bourse would have less stringent requirements and regulations than the main Tel Aviv Stock Exchange, allowing smaller companies to raise funds from the public. Guetta said she is pushing for Israeli institutional investors to engage more in the country’s booming high-tech sector, which has mostly raised funds abroad, and that the secondary market could be a good platform to do so. (Reuters)

Trump China tariff delay lifts Tel Aviv shares

The Tel Aviv Stock Exchange joined a global advance of shares prices on Monday after U.S. President Donald Trump said he would delay imposing further tariffs on Chinese goods. The TA-35 index rose close to 0.9% to 1,587.96 points, and the TA-125 added 0.8% to 1,445,49 on turnover of 1.15 billion shekels ($320 million). Insurance shares paced gains, with Phoenix rising 1.85% to 21.46 shekels, Harel adding 1.6% to 26.65 and Migdal 1.4% to 3.62. Spacecom soared for a second day on news it would be launching its Amos 17 satellite soon. The stock closed 21% higher at 10.09 following a 30% rise on Sunday. Nice rose 1.8% to 427.70 and Teva Pharmaceuticals advanced 1.4% to 63.26 after falling the previous four sessions. Cellular shares were lower, with Cellcom Israel off 1.1% to 16.90 and Partner Communications off 1% to 16.45. (Eran Azran)