Fertilizer company Israel Chemicals (TASE: ICL: NYSE: ICL) plans to continue selling holdings that are not highly synergistic with its core business, company chairman Johanan Locker said at an investor conference held by the company at the Tel Aviv Stock Exchange (TASE). Locker added that the company was considering the sale of businesses totaling $500 million in value.
Israel Chemicals is controlled by Israel Corporation (TASE: ILCO), of which Idan Ofer is the controlling shareholder. It recently closed a deal for the sale of its 50% stake in water desalination company IDE Technologies Ltd. for $178 million. The group that bought the shares included Clal Insurance Enterprises Holdings Ltd. (TASE: CLIS) (which will own 20% of IDE), the advanced training fund of the Teachers Union (20%), and IDE president and CEO Avshalom Felber (10%). Completion of the deal is slated for this year, subject to fulfillment of several suspending conditions, including approval from the responsible authorities.
Israel Chemicals is managed by acting CEO Asher Grinbaum, after the previous CEO, Stefan Borgas, left his position last September. Since beginning his term, Grinbaum has been cutting spending and bringing costs and working capital under control, in order to ease the negative effect of falling raw material and commodities prices, mainly potash prices, in recent years.
Israel Chemicals' share price was up 2% today, but has fallen 40% over the past three years, dropping the company's market cap to NIS 20 billion.
Israel Chemicals finished 2016 with a $122 million net loss on $5.36 billion revenue, compared with a $509 million net profit in 2015. Contributing to the loss was a $473 million write-down by the company on its investments in an enterprise resource planning (ERP) computer system and in Allana Potash, which has a potash mine in Ethiopia, after Grinbaum decided to stop these investments.
Israel Chemicals posted a $68 million net profit in the first quarter of this year, the same as in the corresponding quarter last year. Sales were up 2.3% to $1.3 billion, and operating profit rose 8.4% to $116 million.
Published by Globes [online], Israel Business News - www.globes-online.com - on June 22, 2017
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