Business in Brief: Pipeline for Gas to Turkey Could Be Ready in Four Years, Delek-Avner CEO Says

Hadera Paper ekes out profit despite sharp drop in paper prices; Kite Pharma looks to raise $375 million after 50% spike in shares; Plunging Opko Health leaves TA-35 down in generally higher market.

Reuters

Pipeline for gas to Turkey could be ready in four years, Delek-Avner CEO says

An underwater pipeline connecting Israel’s massive offshore natural gas field Leviathan to Turkey could be built within four years, one of the partners in the project said Thursday. Israel has been pursuing several regional export deals for its newfound gas reserves and the Leviathan group is moving ahead with development plans since making its final $3.75 billion final investment decision last week. Yossi Abu, CEO of Delek Drilling and Avner Oil, said a new 500-kilometer (310-mile) pipeline could have gas flowing to Turkey by the end of 2020, about a year after it comes online for the Israeli market. “This is the target,” he told reporters at a news briefing. Additional export destinations being discussed are Egypt, Europe and the Palestinian territories, including power plants in the Gaza Strip and West Bank, Abu said. Delek and Avner shares both ended 0.5% higher at 13.07 shekels ($3.55) and 2.42 shekels, respectively. (Reuters)

Hadera Paper ekes out profit despite sharp drop in paper prices

Hadera Paper overcame a sharp drop in prices for its key packaging and printing and writing paper products in the fourth quarter of 2016 to post a small profit. The company, which is controlled by the FIMI private equity fund, said Thursday it earned a 4-million-shekel ($1.1 million) profit in the three months, turning around from a 57-million-shekel loss a year earlier. Revenues were down 10% in the quarter to 394 million shekels, led by a 17% drop in sales of packaging paper, to 110 million shekels. CEO Gadi Kunya attributed lower prices for packaging paper to lower world prices and stiffer competition from imports, whose prices fell because of the strong shekel. Hadera was able to offset the impact with a reduction of 11% per ton of paper in production costs, thanks to lower and energy costs in the quarter, he said. Shares of Hadera finished unchanged at 155 shekels. (Yoram Gabison)

Kite Pharma looks to raise $375 million after 50% spike in shares

Kite Pharma, a developer of cancer treatments, launched a public offering Thursday after its stock rocketed 51% over the previous three days. The U.S. company, founded by Israeli Arie Belldegrun, said it was selling 4.75 million shares at $75 each, equal to an 8.6% stake, in an offering that could raise $375 million. Kite shares rallied this week after it reported positive results from a study of its KTE-C19 treatment for aggressive non-Hodgkin’s lymphoma, which turns patients’ immune T-cells into cancer-hunting killers. Cowen & Company believes the U.S. Food and Drug Administration will approve KTE-C19 treatment later this year, with revenues beginning in 2018. At $250,000 a patient on average, that would generate $50 million in sales for Kite next year, rising to $750 million in 2022, Cowen said. Kite shares were down 5.3% at $75.38 at midday local time in New York. (Yoram Gabison)

Plunging Opko Health leaves TA-35 down in generally higher market

Tel Aviv shares were higher Thursday, but a sharp drop in Opko Health following its fourth-quarter earnings report left the TA-35 index lower for the day. The blue-chip index was down 0.1% for the day at 1,443.15 points, while the TA-125 ended up 0.3% at 1,287.66 points, in unusually heavy trading of more than 3.5 billion shekels ($950 million). Opko, which accounts for 5% of the TA-35, plunged 11.5% to close at 27.71 shekels. Opko reported a quarterly loss of 4 cents a share as revenues reached $275.5 million in the period, below forecasts for $305 million. Among gainers, real estate company Melisron extended its Wednesday gain on the back of positive quarterly results to post a 2% rise to 193.70. Ormat Technologies also extended gains on strong quarterly earnings, finishing up 2.6% at 218 shekels. Partner Communications advanced 1.6% to 23.49 shekels. Kenon Holdings rose 4.4% to 44.50 shekels, on reports that it was weighing listing its IP Power unit in Tel Aviv. (Omri Zerachovitz)