Israeli Defense Firm Elbit on Lookout for More Acquisitions

Business in Brief | Housing & Construction officials questioned ■ Zim to partner with Maersk, MSC on routes ■ Wall Street undercuts Tel Aviv shares

FILE PHOTO: A man demonstrates wearing Elbit System's advanced helmet mounted system.
\ Baz Ratner/ REUTERS

Housing & Construction officials questioned

Two former and one current Housing & Construction Limited executives were called in for questioning on Thursday as the police probe  into allegations that the company bribed African officials widened. Investigators questioned former CEO Ofer Kutler and former Chairwoman Ravit Barniv as well as Rony Paluch, the current CEO of the company’s SBI unit, which is at the center of the probe. The move follows the police calling in H&C’s current chairman, Moshe Lahmani, and host of employees in its finance department including Chief Financial Officer Tal Raz earlier this week. The cloud hovering over all of H&C could jeopardize its business in Israel, where the company has won several big government contracts, and complicate its ability to get loans. “We are monitoring developments at the company and if we receive recommendations from the proper authorities we will weight their impact on the projects,” a treasury spokesman. H&C shares ended down 2.6% at 6.71 shekels ($1.84). (Efrat Neuman)  

Zim to partner with Maersk, MSC on routes

Israel’s Zim Integrated Shipping Services said on Thursday it would cooperate with Maersk Line and Mediterranean Shipping Company on the Asia-U.S. East Coast trade, providing a boost to it Pacific services. Starting in September the companies will operate together five loops between Asia and the U.S. East Coast. Zim will operate one loop and the other four will be operated by Maersk and MSC. “The new cooperation offers Zim’s customers a more comprehensive product portfolio, with a wider range of direct calls in Asia and the U.S. and faster transit time,” the company said in a statement. “In addition, it is expected to generate cost efficiencies for Zim.” The term of the strategic cooperation, which is subject to regulatory approval, is seven years. Zim, which operates about 80 container vessels, is 32 %-owned by Kenon Holdings, whose shares ended up 1.4% at 56.50 shekels($15.46) on the Tel Aviv Stock Exchange. (Reuters)

Elbit on lookout for more acquisitions

Defense electronics firm Elbit Systems remains on the lookout for takeover targets in the United States and Europe, Ran Kril, executive vice president for international marketing and business development, told Reuters on Wednesday. “M&A has been and will be part of our strategy as we are trying to strengthen our presence in the U.S., U.K. and Europe,” he said. European demand for military and security systems is being fueled by security concerns over Russia and increased immigration as well as by long-neglected modernization needs. “After many years, for defense industries, Europe has woken up. We see a dramatic change in budgets and demand, and in the willingness to promote security and defense,” he said. Arnon Bram, who heads the unit that makes such Direct Infrared Counter Measures systems, said 135 systems had been sold or ordered by 19 customers in 15 countries. The company expected to more than double that number in coming years, Bram said. (Reuters)

Wall Street undercuts Tel Aviv shares

Tel Aviv shares ended lower on Thursday after lower Wall Street opening cut short what looked to be an end-of-the-session rally. The benchmark TA-35 index finished 0.3% lower at 1,544.13 and the TA-125 down 0.2% at 1,382.20 on volume of  just 794 million shekels ($217 million).  El Al Airlines slid 2.8% to 93 agorot and Perrigo lost 2.3% to 274.80 shekels. Summit dropped 0.8% to 31.63, despite Rosario’s setting a target price for the stock of 36. Leading TA-125 stocks, TowerJazz added 3.6% to 82.30 and B Communications 2.6% to 19.21. Inter Industries fell 3.1% to 5.56 after it issued 26 million shekels in bonds convertible into shares at 7.55. In the fixed-income market, the government bond due in 2028 fell 0.23% to a yield of 2.16%. Bonds of U.S. corporates traded nervously, with Starwood West dropping 2.33%. (Eran Azran)