Magal Security Systems Ltd. (Nasdaq:MAGS; TASE: MAGS) has withdrawn its registration statement for its proposed rights offering. The statement had been filed with the US Securities Exchange Commission (SEC) and the Israeli Securities Authority.
The company said that the postponement is due to technical difficulties in harmonizing the regulatory requirements in Israel and the US. Magal plans raising the funds after the filing of its annual report on Form 20-F with the SEC, which must be published by the end of June 2011.
Nathan Kirsh who holds a 10.3% stake in Magal is committed to buy all the rights that other shareholders do not buy, and he has placed interim funding of NIS 10 million at the company's disposal.
Two months ago Magal CEO Eitan Livneh told "Globes," "The money has three strategic targets. Firstly, to improve company cash flow with the banks. Secondly, to enable our development plan in Israel and Canada where we are investing considerable sums in development. Thirdly, to think about strategic investment that I hope will be successful. It could be a technological acquisition, a merger or acquisition, and this topic occupies us in the strategic future of the company."
Magal's share price was up 4.68% to NIS 11.40 in afternoon trading on the TASE. The share price closed at $3.05 on Nasdaq yesterday, giving a market cap of $30.46 million.
Published by Globes, Israel business news - www.globes-online.com - on March 3, 2011
© Copyright of Globes Publisher Itonut (1983) Ltd. 2011