Israel Corporation is planning to split its holdings into two separate companies, according to a statement released early Wednesday morning. The move is meant to bring the company's market value closer in line with the net value of its assets. By noon the share price had climbed 10%.
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The company, controlled by Idan Ofer, intends to spin off its fully-owned IC Power and IC Green Energy, its 38% stake in TowerJazz and its 50% stake in Chinese carmaker Qoros into a new company whose shares will be distributed among Israel Corporation shareholders. The new company, which will also assume any holdings that might be retained in subsidiary Zim Integrated Shipping Services once an anticipated debt restructuring is carried out, will likely be listed for trading on the Tel Aviv Stock Exchange or a foreign exchange.
Meanwhile, the original Israel Corporation will be left with its 52% controlling share in Israel Chemical Limited and a 37% stake in Oil Refineries Ltd. (Bazan) and continue to trade on the TASE. The company expects the process to take between six and twelve months to complete.
Israel Corporation will continue to carry its unconsolidated bank and bond debts. The company might also decide to spin off its Bazan holdings sometime in the future and be left with just its ICL shares. After the move is completed Israel Corporation intends to refrain from making any further investments.
"Our goal is to increase exposure of the company's holdings to both a broader and more focused investor base in the areas of activity relevant to each holding," said company chairman Amir Elstein.