Delek Group Ltd. (TASE: DLEKG), controlled by Yitzhak Tshuva, is slightly improving its offer to purchase for the 11.8% of Delek Energy Systems Ltd.'s (TASE:DEOL) share capital held by the public, and is extending the deadline for accepting it from April 10 to Thursday, April 12.
For each Delek Energy share, Delek Group is now offering NIS 703.64 in cash, compared with NIS 636.40 in the previous offer. The other components of the offer are unchanged: 0.85 shares in Delek Group and 45 participation units in Delek Drilling.
The Delek Group share price ended up at NIS 558 yesterday, and participation units in Delek Drilling were at NIS 10.24, so Delek is actually offering NIS 1,639 per Delek Energy share, the price of which closed at NIS 1,630 yesterday. In other words, the price in the offer to purchase is now close to the market price for Delek Energy's share, and the chances that the measure will succeed are greater (although still very marginal, because offers to purchase are usually 10-20% higher than the market price).
The offer to purchase's success depends on its acceptance by owners of at least 7% of the shares in Delek Group's subsidiary. According to figures compiled by Stockr.co.il, investment institutions hold 5.8% of the shares in Delek Energy, i.e. 49% of all the shares held by the public. The investment institution with the largest holding is the advanced training funds of the kindergarten and school teachers - 2.1%. Other major investment institutions with major holdings in Delek Energy are Clal Insurance Enterprises Holdings Ltd. (TASE: CLIS) (1.04%), Psagot Investment House Ltd. (0.85%), and Yelin Lapidot (0.75%).
Delek Group said that the measure was part of its business strategy for simplifying its holding structure as part of the group's preparations for a possible overseas offering of its energy activity.
The group also emphasized that to the extent that the offer to purchase is completed, it will enable shareholders in Delek Energy to continue benefiting from a direct holding that is "closer" to the Israeli natural gas reservoirs (Leviathan and Tamar), through participation units in Delek Drilling, together with exposure to Delek Group's international energy activity, ahead of a possible overseas IPO (in addition to exposure to Delek Group's energy activity in Israel) and cash proceeds, at a premium above the market price.
Published by Globes [online], Israel business news - www.globes-online.com - on April 9, 2018
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