Business in Brief: Court Offers to Let IDB Pledge 4.99% of Its Clal Insurance Stake to Bondholders

Fuhrer boosts stake in JEC to 24%, becoming biggest shareholder; Delek Group opts out of deal to take stake in North Sea oil field; Share indices squeeze out last-minute gains.

Daniel Bar On

Court offers to let IDB pledge 4.99% of its Clal Insurance stake to bondholders

IDB Development Corporation was told by the Supreme Court on Thursday that it couldn’t pledge all the shares it wanted in its Clal Insurance unit as collateral for a bond issue but offered as a compromise with regulators that some could be used. The holding company, controlled by Argentine Eduardo Elsztain, had sought to pledge 19% of Clal to investors in a 325 million-shekel ($85.9 million) bond offering, some of whose proceedings it urgently needs to pay off debt coming due. But Dorit Salinger, the treasury’s commissioner of capital markets, insurance and long-term savings, opposed the move, saying it would undermine her efforts to force IDB to divest Clal. In the meantime, the proceeds of the bond sale are being held by a trustee. Justice Hanan Melcer suggested as a compromise that IDB be allowed to pledge a 4.99% stake and ordered Salinger to show cause for why she would oppose such a move. (Shelly Appelberg)

Fuhrer boosts stake in JEC to 24%, becoming biggest shareholder

David Fuhrer, the controlling shareholder of Neopharm Group, emerged on Wednesday as the biggest shareholder in Jerusalem Economic Corporation after he bought most of Summit Real Estate’s 19% stake in the property company. Fuhrer paid 8.80 shekels ($2.32) a share, a 3% premium on JEC’s closing price the day before, which represented a 120 million-shekel profit for Summit in just six months in the 260 million sale. “I saw that JEC had enjoyed big demand of a billion shekels for its 528 million-shekel Yud-Daled bond sale at an interest rate of 2.4%, a move that solved its shareholders’ equity problem. I understood its cash problems are over and from now on it will enjoy not a little upside from upgrading its properties,” Fuhrer told TheMarker, explaining his move. He said he had no plans to increase his stake or make a general offer to shareholders. JEC shares climbed 2.25% up to close at 8.74 shekels on Thursday. Summit rose 2.1% to 21.83 shekels. (Michael Rochvarger)

Delek Group opts out of deal to take stake in North Sea oil field

Delek Group on Thursday pulled back from plans announced in July to invest in a North Sea oil field, saying it was concerned that the partnership was too risky. Delek, which is controlled by Yitzhak Tshuva, had agreed in principle to buy a 20% stake in the Kraken oil field from the British company EnQuest. “It wasn’t clear to us they were the best partners,” said a source close to the negotiations, who said Delek executives believed there were better opportunities in other markets. The company has been seeking to expand its energy portfolio, which is now based mainly on its holdings in Israel’s Tamar and Leviathan gas fields. “The company is continuing to explore other investments in upstream energy in international market as part of its strategy of focusing on this sector, and with the goal of becoming a major player in international markets,” it said in a statement. Delek shares finished up 1.8% at 744.70 shekels ($196.75). (Eran Azran)

Share indices squeeze out last-minute gains

Tel Aviv shares ended mixed on Thursday, with the two major indices squeezing out gains in the final minutes of trading. The blue chip TA-24 finished the day up almost 0.2% at 1,434.60 points, while the TA-100 eked out a 0.04% gain to 1,255.75, on turnover of 1.35 billion shekels ($360 million). Real estate stocks helped lift the indices, with Azrieli Group finishing up 3.9% at 165 shekels and Bayside ahead 2% to 14.59. But drug stocks were all lower. Volume leader Teva Pharmaceuticals lost 1.4% to 196.20 even though the company reported on Thursday that the U.S. had approved its generic version of the Cubicin skin antibiotic. Cubicin has sales of $1.2 billion annually. Perrigo fell 2.9% to 349.40 and Mylan lost 1.2% to 155. Cellular shares were down, too, led by a 2.4% decline for Cellcom Israel to 28.12 and a 2.1% decline for Partner Communications to 18.36. Elbit Systems enjoyed heavy trading but was up just 0.1% for the day at 3.47. (Guy Erez)