Is Oded Feller about to sell his holdings in Palziv, the polyethylene foam products maker controlled by Kibbutz Ein Nanatziv? According to market sources, Emilia Development (OFG) Ltd. (TASE:EMDV), controlled by Feller, is examining the possibility of selling its entire 25% stake in the prosperous kibbutz company. Feller is believed to have received approaches from various interested parties. Emilia Development said in response, "No negotiations are taking place on the sale of our holdings in Palziv."
Emilia Development bought its holding in Palziv in January 2008 in an allocation of shares in exchange for an investment of NIS 28 million and a mechanism for adjusting the investment by an additional sum of up to NIS 8.6 million, in accordance with the meeting of profit targets. Palziv has one main business: making a wide range of cross-linked, closed-cell polyethylene foam products.
In its 2013 financials, Emilia Development stated that Palziv's market was expanding, but that competition in its field of activity had grown in recent years, and that the price of polyethylene, Palziv's raw material, was subject to high volatility, stemming from movements in the price of oil. Emilia also explained that Palziv's field was characterized by a small number of players globally, and that it was undergoing consolidation.
Palziv's sales totaled NIS 242.3 million in 2013, compared with NIS 230.7 million in 2012. Most of its sales are outside Israel. In general, the company is profitable, although it made a small loss in the second quarter of this year. Its net profit was NIS 15.5 million in 2013, compared with NIS 12.2 million in 2012 and NIS 6.3 million in 2011. At the end of 2013 it had about 480 employees. Palziv is eligible for various grants and tax breaks under the Law for the Encouragement of Capital Investment.
Published by Globes [online], Israel business news - www.globes-online.com - on October 23, 2014
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