Ormat Technologies Inc. (NYSE: ORA) is expected to register for trading on the Tel Aviv Stock Exchange (TASE), following the completion of its merger with Ormat Industries Ltd. (TASE: ORMT). Ormat controlling shareholders FIMI Opportunity Funds and the Bronicki family are going ahead with a merger between Ormat Industries, already listed on the TASE, and Ormat Technologies. It was initially thought that the TASE was "losing" Ormat Industries, which will be delisted, but the company has now announced that its board of directors plans to register Ormat Technologies shares on the TASE. The company reportedly hopes that Ormat will enter the Tel Aviv 25 Index.
Ormat Technnologies' market cap is $1.2 billion. In addition to the TASE, Ormat will also be registered on a third stock exchange, and the company board is currently weighing possibilities in European and Far Eastern stock exchanges. The company will not raise any capital as part of its registration. Ormat is currently negotiating the entry of a partner into the ownership of its US assets at a value of $425 million, which is expected to inject capital into the company and help enhance its value.
"The additional registration will serve the company goals of increasing its marketability and generating interest among a broader range of shareholders," company CEO Isaac Angel said.
FIMI believes in the TASE
Ormat operates in the geothermal energy industry, and Ormat Technologies accounts for most of the activity of Ormat Industries, which owns a 60% stake in Ormat Technologies. In the merger, Ormat Technologies, the subsidiary, will acquire the shareholders' stake in its parent company, Ormat Industries, for an allocation of shares in Ormat Technologies at a ratio of 0.2592 ordinary Ormat Technologies shares per 1 Ormat Industries share. Israeli financial institutions, including Migdal Insurance and Financial Holdings Ltd. (TASE: MGDL) and Psagot Investment House Ltd., are among the Ormat Industries shareholders, with holdings of 9.2% and 7.4% respectively, and as such will receive shares on Ormat Technologies. It is more convenient for them to hold shares in a company listed on the TASE.
FIMI, managed by founder and CEO Ishay Davidi, owns 24.2% of Ormat, and the Bronicki family, which founded Ormat, owns 14.2%. In contrast to the trend of delisting companies from the TASE, FIMI believes in the local stock exchange, and more than a few of its portfolio companies are listed on it, including Gilat Satellite Networks Ltd. (Nasdaq: GILT; TASE: GILT), TAT Technologies Ltd. (Nasdaq:TATT; TASE:TATTF), Inrom Construction Industries Ltd. (TASE: INRM) (listed this year), and Nesher Israel Cement Enterprises Ltd..
Published by Globes [online], Israel business news - www.globes-online.com - on December 11, 2014
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