Ormat Industries Ltd. (TASE: ORMT) denies the reports that have circulated today about a possible sale of the company. In a statement to the Tel Aviv Stock Exchange (TASE), the company said, “To make it absolutely clear, the company hereby states regarding the reports in the media about negotiations between Apax Partners and the controlling shareholders in the company, the Bronicki family, related to the sale of the shares in the company, that the said shareholders deny the existence of any negotiations for the sale of their holdings in the company. As for the estimated company value mentioned in the reports in this regard, the company is not the source of the figures mentioned, and they are published without the company’s knowledge, and have not been examined by it.”
Apax also strongly denied the report that appeared in Hebrew daily “Yediot Ahronot” this morning that Apax was in negotiations to buy the Bronickis’ stake in Ormat at a company value of NIS 8-9 billion.
If the report turns out to be true, it will severely damage the reputation of both Ormat and Apax. Ormat’s notice to the TASE has legal significance as well. If Ormat chairman Lucien Bronicki and CEO Yehudit (Dita) Bronicki have lied, the Israel Securities Authority can summon them for an inquiry and company shareholders can sue them.
It is hard to imagine the straight-as-a-die Bronickis taking such a risk after so many years of working by the book.
Clal Finance Batucha analyst Yuval Ben-Zeev, however, took the unusual step of raising his recommendation for Ormat to “Outperform” from “Market performer”. He mentions the possibility that the Bronickis will offer Ormat through a private placement of shares, hinting that the “Yediot Ahronot” report about Apax makes sense, albeit not through the acquisition of the company from the Bronickis, but by Apax joining the controlling core in the company. In this scenario, the parties’ denial is not a lie.
Ben-Zeev mentioned Africa-Israel Investments Ltd. (TASE:AFIL; Pink Sheets:AFIVY.PK) and Gazit Inc. (TASE: GZIT) as possible buyers.
Published by Globes [online], Israel business news - www.globes.co.il - on October 17, 2007
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