The Ticker: Teva Shares Jump, IDE Buys Out Stake in Sorek Desalination Plant

Good news for two of its partner drug makers boost Teva shares ■ Israel Discount Bank shareholders turn down central bank candidate ■ Tel Aviv Stock Exchange finishes little changed in subdued trading

Workers of Teva Pharmaceutical Industries stand at the entrance to their facility in Ashdod, Israel December 17, 2017
\ AMIR COHEN / REUTERS

Teva shares jump on good news for two of its partner drug makers

Teva Pharmaceuticals shares 5.8% to 81.80 shekels ($22.93)  on Sunday on back-to-back news regarding two proprietary drugs. U.S. drug maker Eagle Pharmaceuticals won a lawsuit against the U.S. Food and Drug Administration for refusing to give orphan status to its Bendeka leukemia and lymphoma treatment. Teva has U.S. rights to market the drug and is its No. 2 best-seller with sales in the last 12 months of $683 million. As an orphan drug the companies get seven extra years of patent protection before generic makers can compete. Meanwhile, South Korea’s Celltrion said it refiled with the FDA its application to market its biosimilar version of Rituxan and will resubmit its Herceptin biosimilar next month, with approval expected by the end of the year. Not only does Teva have U.S. and Canadian marketing rights to the drugs, but the latest news improves its odds of winning FDA clearance for its migraine treatment fremanezumab, which is being manufactured by Celltrion. (Yoram Gabison)

Israel Discount Bank shareholders reject central bank candidate for board chairman

In an embarrassment for the Bank of Israel, Israel Discount Bank shareholders over the weekend rejected its choice for chairman of the board. The central bank committee charged with selecting board chairmen for banks like Discount that don’t have a controlling shareholder nominated Yoram Ariav, a former treasury director general, to replace Yossi Bachar as chairman when he steps down at the end of the year. But shareholders rejected Ariav’s candidacy for a post on the board altogether. Ariav has no banking experience, but he enjoyed a long career in business and finance, serving among other things as a top executive at Israel Chemicals and chairman of the investment committee for the Amitim pension fund. In addition to Ariav, shareholders also voted against Hagai Heller, a former CEO of Leumi Card. The top candidates now for chairman now are current directors Baruch Lederman and Shaul Kobrinsky. Discount shares finished down 0.2% at 10.88 shekels ($3.05). (Michael Rochvarger)

IDE buys out partner Hutchison’s 49% stake in Sorek desalination plant

IDE Technologies, the water desalination company half owned by Delek Group, said on Sunday it had exercised its first refusal and acquired the 49% stake of its Hong Kong-based partner Hutchison Water in their Sorek facility. IDE will pay 190 million shekels ($53.3 million) for the stake, cementing its dominant position in Israel’s desalination sector. In addition, to controlling 100% of Sorek, with a capacity of  620,000 cubic meters daily that makes it the world’s largest desalination plant using reverse osmosis technology. The plant was competed in 2013 at a cost of $500 million under a build-operate-transfer contract that turns over the facility to the government in 2037. When Hutchison Water, unit of Hutchison Whampoa, out up its stake for sale last year the Israel-based Noy infrastructure fund won bidding with a 190 million shekel offer, which IDE then matched.  IDE now controls 70% of Israel’s desalination plants, which means it will be barred from bidding on future contracts.  (Yoram Gabison)

Work on Israel’s biggest wind-power farm due to begin after approvals completed 

Work on Israel biggest wind-power farm is due to get underway after its developer, Enlight, said on Sunday it had completed all the development and regulatory processes needed to arrange financing. The facility will be built at a cost of 685 million shekels ($192 million)  in the Valley of Baca on the Golan Heights and generate 96-99 megawatts of electricity. The company said Israel’s Electricity Authority had approved to it charge rates of 35.81 agorot per kilowatt hour conditional on its getting financing by a September 4 deadline. The company said work would begin at the site in the next several weeks based on an agreement principle it reached nearly four years ago with Bank Hapoalim to lead a loan syndicate that would provide 80% of the financing. Share of Enlight, which said it expected to generate revenues of about 105 million shekels annually from the project, fell 0.6% to close at 2.01 shekels. (Yoram Gabison)

Tel Aviv Stock Exchange finishes little changed in subdued trading

Tel Aviv shares ended virtually unchanged in subdued trading. The TA-35 and TA-125 indices both ended lower by less than 0.1% to 1,532.40 and 1,387.49 points, respectively, on paltry turnover of 423 million shekels ($119 million). Among the biggest gainers, Sapiens rose 3.3% to end at 35.85 shekels and Elbit Systems rose 1.35%, capping a rise of 12.5% in less than two weeks. Losers included Nice, which dropped 1.7% to 380 and Biotime, which shed 4.5% to 8.13 and leaving it down 8.5 over the last four trading days, David Reznik of Leumi Capital Markets said expectations are for a 25 basis point rise in the U.S. Fed’s base rate this week. He noted that despite forecast for more U.S. rate rises, Israeli bond yields keep falling and said the trend won’t reverse until the Bank of Israel raises its rate from record low levels. Israeli 10-year government bonds now yield 1.88% versus 2.99% for their U.S. counterparts. (Assa Sasson)