Israel Securities Authority approves TASE stake sale to New York-based Manikay

Israel Securities Authority approves TASE stake sale to New York-based Manikay

Change in TASE ownership structure will serve its interests, those of its stockholders and those who use its services, the ISA says

A broker at the Tel Aviv Stock exchange. (Moshe Shai/Flash90)
A broker at the Tel Aviv Stock exchange. (Moshe Shai/Flash90)

Israel’s Securities Authority has approved the sale of a stake in the Tel Aviv Stock Exchange to the New York-based investment fund Manikay Partners LLC, which will acquire a 19.99% in Israel’s only exchange.

The remainder of the 71.7 percent of shares put up for sale will be sold to four additional international investors, with each of them directly holding no more than 4.69% of TASE shares, while the remaining 32.9% will be held by a trustee, for a future sale of shares in a public offering, the ISA said in a statement on Sunday. The current owners of TASE, who are also its members, will see their stakes drop to no more than 5% within five years.

“In this manner, the TASE will become a public company with a more diversified control of ownership and greater transparency of operations,” the statement said.

The other institutional investors that will hold a stake of not more than 4.69% are privately owned Australia-based investment management firm Sunsuper PTY Ltd.; financial services group Moelis Australia Asset Management Ltd.; California-based financial planners Dalton Investments LLC; and Denmark’s Novo Nordisk Foundation.

In the approval review process, the ISA considered a number of issues, including “public interest, the reliability of the permit applicants, potential conflicts of interest, and the implications of the change on the proper and fair functioning of the TASE,” the statement said.

The change in TASE ownership structure “will allow the TASE to focus on its business in a manner that best serves its interests, the interests of its stockholders, and the interests of everyone who uses its services, and will allow it to direct its operations in a manner that is aligned with the needs of the entire market in a more efficient and competitive manner,” the statement continued.

The entry of international investors will make the TASE “more accessible to new companies, investors, and markets,” the statement said.

The board of directors of the exchange on April 16 approved the sale of stakes to investors including Manikay, the public, and other international investors, a statement published by the TASE said.

Following the sale, players in Israel’s capital markets expressed surprise at the seemingly covert way in which the Tel Aviv Stock Exchange agreed to sell an almost 20 percent stake to New York-based fund Manikay Partners LLC at a valuation of NIS 551 million ($151 million).

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