Generic drugs company Mylan has announced its intention of delisting from the Tel Aviv Stock Exchange. Mylan has been traded in Tel Aviv since November 2015, when it listed as a tactic in its attempted takeover of Perrigo. When the attempt failed (along with Teva's attempt to take over Mylan itself), Mylan said it would remain on the Tel Aviv Stock Exchange, but it seems that it has now decided that this is superfluous. This is despite that fact that its stock is a component of all the leading indices, and that being excluded from these indices will mean that exchange traded funds will sell shares.
Mylan's move is a blow to the Tel Aviv Stock Exchange, which only this year began to recover from a period of drought. The exchange will lose 8.7% of its value and 3.1% of its liquidity.
Mylan will be delisted in three months' time, on February 12, 2018. The company said that the shares traded in Tel Aviv may be transferred to Nasdaq.
Along with the generics market as a whole, Mylan has been going through a challenging period. Since July 2015, when the takeover battles in the generics sector were at their height, the company has lost about half of its market cap, and about 14% since it listed in Tel Aviv. A short while before the announcement about the delisting, Mylan announced that it would lay off hundreds of employees.
Mylan chairman Robert J. Coury said, "Over the last two years, we have learned that many of our Israeli institutional shareholders actually hold their shares in Mylan on the Nasdaq. Further, Mylan's holding on the TASE represents less than 3.5% of our total shareholdings and the average trading volume on the TASE is less than 3.5% of our global trading volume. Given these factors and the fact that the TASE's trading hours and days are different from other markets, our board of directors decided at this time that it would not be in Mylan's best interests to continue our listing on the TASE. That said, we do appreciate the ties we have forged with the Israeli institutional market.
"More importantly, over the last two years, I have had the privilege of becoming acquainted with the dynamic Israeli business environment and the strong work ethic of its people. As a result, we remain committed to considering future investments and other business development opportunities in Israel."
Given that Mylan currently has a higher market cap than Teva, and that several smaller generic drug companies operate in Israel (such as Dexcel Pharma), as well as companies specializing in drug delivery and special release technologies (such as Oramed and Intec Pharma), it is not inconceivable that these are not just polite words.
Published by Globes [online], Israel business news - www.globes-online.com - on November 12, 2017
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