Israel's Elbit Wins U.S. Contract That Could Reach $176 Million Over Five Years

Business in Brief| Stock exchange CEO says TASE makes progress on turnaround ■ Frutarom buys 51% of Brazil firm for $31m ■ Insurance, energy stocks lead Tel Aviv gains

A man demonstrates wearing Elbit System's advanced helmet mounted system, at their offices in Haifa, Israel February 26, 2017.
Baz Ratner / Reuters

Elbit wins U.S. contract that could reach $176 million over five years

Elbit Systems said Wednesday its U.S. subsidiary won a contract from DynCorp International to provide support services for the U.S. Army’s C-26 and UC-35 aircraft fleet. The contract is worth up to $25 million in the first year and contains five single-year options that if exercised in their entirety will boost the total contract value to $176 million, Elbit said. The contract strengthens Elbit Systems’ U.S. unit’s role as a major service provider for the U.S. Army’s aircraft and ground platforms. Such services have become an important growth engine for the entire company as the world’s armed forces increasing turn to private sector contractors to provide these services. Elibit runs a pilots’ training program for Britain’s Royal Air Force together with the U.K. company KBR. Shares of Elbit, which a day earlier won a $46 million equipment contract from  NATO for its Airbus A330 tankers, ended 2.1% higher at 475.10 shekels ($136). (Yoram Gabison)

Stock exchange CEO says TASE makes progress on turnaround

Tel Aviv Stock Exchange CEO Ittai Ben-Zeev expressed satisfaction with the bourse’s performance this year as it recovers from years of thin trading, delistings and a paucity of initial public offerings. “We’re still not in the place we need to be, but there has unquestionably been a major improvement,” he told an end-of-the-year news conference Wednesday. “Liquidity at the bourse has grown and we’ve expanded the basket of services for investors. Also in terms of raising capital, we’re seeing a rising trend that will continue next year, in part because of dual listings.” This year saw 17 IPOs that raised a combined 7.6 billion shekels ($2.2 billion), which made the TASE the world leader, after Warsaw, in the ratio of IPOs by valuation to total market cap. Ben-Zeev told TheMarker that Finance Minister Moshe Kahlon was looking favorably on the idea of floating shares in state-owned companies on the TASE. (Guy Erez)

Frutarom buys 51% of Brazil firm for $31m

Flavors and ingredients maker Frutarom said Wednesday it agreed to buy 51% of Bremil Indústria, a Brazilian company in the same industry for at least $31 million. The deal includes milestone payments based on Bremil’s performance in 2017 and 2018 and an option to buy the rest of Bremil in the five years after the initial transaction is completed in early 2018 at a price based on the company’s performance. Bremil, which employs 250 and had revenue of $47 million in the year to October 31, is Frutarom’s 12th acquisition this year. Frutarom, which has made four acquisitions in the last five years in Brazil and seven in Latin America, said it would seek to expand Bremil’s activity into additional countries in the region. Separately, Frutarom said it acquired Polish flavors and fragrances maker Pollena-Aroma for $8.5 million. Frutarom shares finished up 3.4% at 304.90 shekels ($87.28). (Yoram Gabison)

Insurance, energy stocks lead Tel Aviv gains

Tel Aviv shares ended higher Wednesday, led by gains for insurance and energy stocks. The TA-35 and TA-125 indexes both ended over 0.3% higher at 1,478.37 and 1,336.48 points, respectively. Turnover was 1.17 billion shekels ($330 million). Migdal led insurance stocks and the TA-125 higher, climbing 5% to 3.81 shekels. Phoenix added 3.1% to 18.59. Among energy stocks, Delek Drilling rose 3.5% to a close of 1511.50 and Isramco rose 2.7% to 46 agorot after it said it would pay a 490 million shekel dividend as part of a plan to distribute its share of profits from the Tamar gas field. Other big gainers were holding company Kenon Group, which finished 3.6% up at 72.02. Bonus BioGroup soared 18.7% to 52 agorot after it reported that its tissue-engineering technology was used in groundbreaking surgery to regrow part of a human bone at Haemek Hospital in Afula this week. (Omri Zerachovitz)