Business in Brief: Teva Launches Roadshow to Raise $20 Billion in Bond Offerings

Delek Group considers 400-million-shekel bond offering; ICL shares close up 4.8% in heavy trading; TASE shares follow world markets higher.

Teva's headquarters in Jerusalem.
Bloomberg

Teva launches a roadshow to raise $20 billion in a bond offering

Teva Pharmaceutical Industries has embarked on a roadshow to sell $20 billion in bonds. The bond issue is expected to close next week and will be led by Bank of America, Merrill Lynch and Barclays. In other news related to Teva, company CEO Erez Vigodman said Wednesday that he expected Teva’s acquisition of Allergan’s generic drug business, Actavis Generics, to close soon. The deal was first announced last July and had been expected to wrap up last month, but it has taken longer as the companies have arranged sales of more drugs than anticipated to satisfy antitrust regulators. Vigodman said the effective price of the acquisition had declined from $40.1 billion to $35.1 billion and the burden entailed in financing the deal had dropped from $27 billion to $23 billion. In yet another development, the S&P rating agency lowered Teva’s rating from BBB+ to BBB- with a “stable” outlook. The agency also noted that it expects Actavis to be smoothly integrated into Teva’s operations. (Yoram Gabison and Reuters)

Delek Group is considering a 400-million-shekel bond offering

The Delek Group announced Wednesday that it is considering issuing about 400 million shekels (about $100 million) worth of new bonds. The company’s announcement included an initial draft prospectus, signaling that it might be looking to market the bonds in relatively short order. Delek said the bonds could be issued by expanding one of its current bond series or through the issuance of a new publicly-traded series of bonds. The group currently has 6.7 billion shekels’ worth of negotiable bonds outstanding as well as two private bond series, involving another 920 million shekels. The bonds are trading at low redemption yields, of less than 2%. The Midroog credit rating agency recently lowered Delek’s debt rating by one notch from A1 to A2, but left its credit outlook unchanged at “stable.” Among the reasons that Midroog gave for the downgrade was the company’s relatively high credit leveraging. In October, Delek raised about 700 million shekels on the capital markets. (Eran Azran)

ICL shares close up 4.8% in heavy trading

Shares of Israel Chemicals closed up 4.8% to 15.84 shekels ($4.11) on the Tel Aviv Stock Exchange Thursday on the back of developments involving competitors in the potash market. This included news that BPC, the export division of Belaruskali, a potash company owned by the government of Belarus, had signed a potash supply agreement in China at a higher than expected $219 per ton, which may indicate that ICL too could demand higher prices. In addition, there was good news for ICL on the supply side after Canadian potash supplier Mosaic decided to halt production at its Colonsay mine in Saskatchewan by the end of the year. That would tend to curb overproduction in the potash market resulting from stepped-up activity at existing mines and the expectation of new mines being opened in Canada. (Yoram Gabison)

TASE shares follow world markets higher

Shares closed generally higher on the Tel Aviv Stock Exchange on Thursday, in keeping with the overall trend on stock markets abroad. The benchmark TA-25 index rose by 0.81% to 1,460.97 points, while the broader TA-100 index gained 0.62% to end the day at 1,270.56 points. The shekel strengthened against most major currencies. The representative rate of the dollar was set at 3.852 shekels, a decline of 0.49% for the greenback, while the euro’s value was set at 4.279 shekels, down 0.18%. The pound was off by 0.69% to 5.099 shekels. The Banks-5 index was a standout, gaining 1.46% to 1336.01, led by Bank Hapoalim, shares of which rose 1.63% to 19.90 shekels ($5.17). Bucking the bullish trend was the Biomed index, which closed at 447.01 points, off 0.9%. The day’s trading volume was 1.26 billion shekels. The Tel Bond-20, -40 and -60 indexes were down between 0.07% and 0.09%. (Omri Zerachovitz)