The Israel Securities Authority is tightening the sanctions it is applying on public companies whose controlling shareholders fail to comply with accepted norms. Today, it took the unprecedented step of banning Africa-Israel Investments Ltd. (TASE:AFIL; Pink Sheets:AFIVY) from offering to public any securities, including through shelf prospectuses, until April 15, 2008.
Until now, the Securities Authority was satisfied with warning company shareholders and officers who gave ostensible "buy" recommendations for their stock through improper channels.
The Securities Authority took the step following comments at a diamond convention last week by Africa-Israel chairman Lev Leviev to the effect that the company "is the best bargain on the market." The Securities Authority added as a clarification that the company that the sanctions did not apply to the issue of commercial paper in the amount of up to NIS 600 million now underway, which is not classified as an offer to the public.
The Securities Authority stated, "In order for the company not to be considered as an entity offering to the public securities not through a prospectus, it is hereby ordered not to carry out any offering of securities to the public, including by shelf prospectus."
Leviev's comments caused Africa-Israel's share to jump more than 10% in two days, by prodding investors to buy the company's stock.
Published by Globes [online], Israel business news - www.globes-online.com - on February 18, 2008
© Copyright of Globes Publisher Itonut (1983) Ltd. 2008