The Ticker: Maabarot Sells 49% Stake in Materna to Partner Osem-Nestle

TowerJazz sees further growth in 2017 after record fourth quarter; Apax in talks to buy medical device maker Syneron; TA-35 advances for a second day as biotechs, insurers rally.

Maabarot sells 49% stake in Materna to partner Osem-Nestle

Maabarot Products said Monday it was selling its 49% stake in infant-formula maker Matera to its partner, Osem, for between 550 million and 600 million shekels ($147 million-$160 million). The kibbutz-owned company said it was exercising a put option it has with Osem, a unit of the Swiss company Nestle, after Osem bought 51% of Materna in 2007. The option entitles Maabarot to sell the 49% stake at 16 times Matera’s annual profits the previous year, which it said would work out to a sale price of up to 600 million shekels. It said the sale, which it expects to be completed by mid-June, would earn it a capital gain of up to 450 million shekels. Materna controls 55% of the market for infant formula and 69% of all baby cereal sales, according to the company’s 2015 annual report. Shares of Maabarot finished 12.9% higher at 66.40 shekels. (Yoram Gabison)

TowerJazz sees further growth in 2017 after record fourth quarter

TowerJazz, which makes chips for smartphones, battery chargers and other devices, said it expected further growth in revenue and profit in 2017 after posting record fourth-quarter results and record results for 2016 as a whole, boosted by robust demand from new and existing customers. The company earned 52 cents per fully diluted share, excluding one-off items, in the quarter, up from 27 cents a share a year earlier, as revenue grew 34% to $340 million. TowerJazz had been forecast to earn 48 cents on revenue of $339.9 million, according to Thomson Reuters I/B/E/S. It projected first-quarter 2017 revenue of about $330 million for a 19% annual gain. CEO Russell Ellwanger said TowerJazz wasn’t providing a specific outlook for 2017 but said he was bullish on the company’s prospects. “We see growth throughout the year,” Ellwanger told Reuters, predicting each quarter of 2017 should beat what had been achieved the year before. “I don’t see anything that prevents us from doing that.” TowerJazz shares closed up 1.6% at 85.88 shekels ($22.89) in Tel Aviv. (Reuters)

Apax in talks to buy medical device maker Syneron

The British private equity fund Apax Partners is considering buying Israel-based Syneron Medical for between $350 million and $400 million, a considerable premium on the aesthetic device maker’s $330 million market valuation. Representatives from Apax’s London headquarters met Syneron executives, including CEO Amit Meridor and chairman and founder Shimon Eckhouse in Israel last week. Apax, which has an office in Israel, is not believed to have made a formal offer for the company. Reuters reported that Apax spokespeople in Israel for would not comment on the report and that no one at Syneron was reachable for immediate comment. Syneron, whose devices are used for body contouring, hair removal and wrinkle reduction under the Syneron and Candela brand names, had sales of $215 million in the first nine months of last year, earning a net profit of just $1 million. Shares of Syneron were up 3.1% at $9.59 late morning New York local time. (Yoram Gabison)

TA-35 advances for a second day as biotechs, insurers rally

After getting off to a slow start, Tel Aviv shares ended higher Monday, paced by biotech shares. Marking its second day of trading, the blue chip TA-35 index rose 0.5% to close at 1,440.57 points, while the TA-125 added 0.7% to 1,274.55, on turnover of 1.66 billion shekels ($440 million). Teva Pharmaceuticals (see story on this page) gave biotech a boost, but other shares helped: Protalix finished 15% higher at 4.61 shekels after a 24% rise on Sunday, although the company made no announcements. Menorah led a rally in insurance shares, rising 4.6% to 37.50 shekels. Energy stocks, however, were lower amid news of possible competition for the Tamar gas field partners from Greek energy company Energean. Delek Drilling and Ratio Oil Exploration both ended down 1.3% at 12.53 and 2.58, respectively. El Al Airlines finished 1.3% lower at 2.46 and Delek group down 1.4% at 7.85. Bezeq, however, was up 1.1% at 6.69 by closing time. (Uri Tomer)