Business in Brief: June 23

By GLOBES
June 22, 2011 23:08

Tshuva to delist Delek Energy; Merck KGaA pulls Copaxone competitor




Traders look at screens at a bank in Lisbon, Weds.

traders watching stocks. (photo credit: Rafael Marchante/Reuters)

Tshuva to delist Delek Energy

By HILLEL KOREN

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Yitzhak Tshuva intends to delist Delek Energy Systems Ltd., through which Delek Group Ltd. controls Yam Tethys, Tamar and Leviathan partners Avner Oil and Gas LP and Delek Drilling LP. Delek Group will offer NIS 1,500 per share for the public’s 18.55 percent holding in Delek Energy, a 30% premium on Tuesday’s closing price of NIS 1,152, according to people familiar with the matter. Tshuva reportedly will not pay cash for the Delek Energy shares, but offer participating units in Avner and Delek Drilling, which are owned by Delek Group. Delek Group directly owns 14.44% of Avner and 9.02% of Delek Drilling.

Last week, Delek Energy was delisted from the Tel Aviv 100 Index in the biannual index update because the public’s stake was below the threshold criteria and because of the thin trading in the share. Delek Group could get Delek Energy back into the index by selling part of its holding in the subsidiary, but Tshuva has apparently decided otherwise. Delek Group currently owns 79.87% of Delek Energy, which owns 46.58% of Avner and 50.21% of Delek Drilling.

Merck KGaA pulls Copaxone competitor

By YOSSI NISSAN and Globes correspondent

Teva Pharmaceutical Industries Ltd.’s share rose on Nasdaq and the Tel Aviv Stock Exchange on Wednesday after Germany’s Merck KGaA pulled its cladribine oral treatment of multiple sclerosis, citing concerns by the US Food and Drug Administration (FDA). “Merck believes that data from ongoing clinical trials are very unlikely to address the [FDA’s] requirements,” the company said, adding that new trials would not justify the costs.

The news will likely benefit Teva by removing a potential competitor to its multiple sclerosis drug Copaxone, as well as for its oral treatment, Laquinimod, which is under development. Novartis AG already markets an oral multiple sclerosis treatment, Gilenya, and other companies are also developing oral treatments as well as generic versions of Copaxone.

Merck KGaA said it would withdraw cladribine from Australia and Russia, where it had been approved and is sold under the name Movectro. In March, the FDA asked Merck to either provide additional analyses of study results it had submitted, or to carry out new trials. The European Medicines Agency (EMEA) rejected cladribine in September, citing some cases of cancer that emerged during a trial.

Elbit Systems wins Italian Air Force deal

Globes correspondent

Elbit Systems Ltd. has won a $15 million contract from Italian defense contractor Elettronica SpA to supply antiaircraft countermeasures for Italian Air Force plans. Deliveries will be made over the next three years, Elbit Systems announced this week at the Paris Air Show. This is Elbit Systems’ second contract in Europe this week, after announcing on Sunday a 5-million-euro contract to supply hundreds of personal locator beacons to the French Defense Ministry.

Elbit Systems will supply ELT/572 DIRCM (Directed Infra- Red Countermeasures) system for installation on C130J Hercules and C27J cargo planes, AW101 cargo helicopters and other planes operated by the Italian Air Force. The ELT/572 DIRCM system is based on the MUSIC system, a joint project of Elettronica and Elbit Systems subsidiary Electro-Optics Elop Ltd. MUSIC’s fiber laser technology emits a laser beam toward an approaching missile causing the missile to veer off course.

Givot Olam begins production at Meged 5

By HILLEL KOREN

 Givot Olam Oil Exploration LP has begun production at the Meged 5 oil well near Rosh Ha’ayin and said output was stable at 800 barrels a day. The company announced last week it would begin production tests at the well within two weeks.

Givot said it would design the oil production process during the long-term production tests and commercial production to operate automatically on Shabbat and Yom Tov. The company has obtained a rabbinical ruling that the automatic process complies with Halacha and does not desecrate Shabbat and Yom Tov. Givot’s share price rose 1.5 percent in morning trading to NIS 0.07, giving a market cap of NIS 729 million.

Harel wins large IDF pension tender

The largest IDF pension tender for career officers and NCOs has been decided, with the IDF awarding the tender to Harel Insurance Investments and Financial Services Ltd., which is controlled by the Hamburger family. Harel beat out Ayalon Holding Ltd., which bid together with Psagot Investment House Ltd.

The IDF’s pension tender is drawing much attention because of its great importance to both the many career officers and NCOs and the pension savings market. The results of the tender could change the nature of the pension market, and the tender winner could become one of the largest in the market within a few years, since it would enjoy deposits of at least NIS 300 million a year.

This amount is expected to grow significantly over the years, since more and more career officers and NCOs are receiving cumulative pensions, and the amount of deposits will grow greatly to NIS 1.5 billion a year in 10 years. In effect, this is the last chance to achieve relatively quick leadership in the pension field, without having to acquire an institutional body.

Since 2004, Migdal Makefet of Migdal Insurance and Financial Holdings Ltd. and Magen Zahav have been handling career officers and NCOs’ cumulative pension funds. The IDF tender was issued in January 2010, following many years of delays, and the two largest companies in the insurance sector – Migdal Insurance and Financial Holdings Ltd. and Clal Insurance Enterprises Holdings Ltd. – unexpectedly decided not to bid for the tender.

Investment house Apex also decided not to bid. Results from the first phase of the tender were published last November, when Ayalon’s and Harel’s competitors, The Phoenix Holdings Ltd., Excellence Investments Ltd. and Menorah Mivtachim Holdings Ltd. were eliminated.


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