Bioline RX ADRs Trade at Premium on First Day: Israel Overnight

Bioline RX Ltd. (BLRX), the Israeli biopharmaceutical company whose largest shareholder is Teva Pharmaceutical Industries Ltd. (TEVA), completed its Nasdaq Stock Market debut to trade at a premium to the Tel Aviv shares.

The company’s American depositary receipts, which represent 10 ordinary shares, closed at $5.59 in New York yesterday, after shares in Israel climbed 7 percent to 1.88 shekels, or the equivalent of 55.6 cents. The Bloomberg Israel-US 25 Index of the largest Israeli companies traded in New York fell the most in seven trading sessions, retreating 1.1 percent to 604.22. The measure is down 3.3 percent this year.

The listing increases the number of Israeli firms on the Nasdaq to 59, the most of any country outside the U.S. after China. Shares of SodaStream International Ltd. (SODA), the Israeli producer of homemade soda machines, more than tripled to $68.01 since its initial share offering in November on the bourse.

“Everyone is well aware that Israel has the main drivers for technology and biotechnology,” said Anthony Moro, the head of emerging markets for Bank of New York Mellon Corp.’s Depositary Receipts group in New York. “Biotechnology is a hot sector right now.”

Market Recognition

Bioline RX, whose leading products include a schizophrenia drug and a cardiac device that acts as a scaffolding to help the heart recover after an attack, aims to raise its profile among U.S. investors, Chief Financial Officer Philip Serlin said yesterday by telephone from Tel Aviv. The shares, down 5.4 percent at the 4:30 p.m. close in Tel Aviv today, have dropped 48 percent over the past year.

The U.S. listing was arranged by Bank of New York Mellon, the company said yesterday in a Business Wire statement. Bioline RX said July 1 that it withdrew plans to sell stock in the U.S.

“This is a long-term play in our part to get a foothold in the U.S. market and get market recognition,”Serlin said.

Bioline RX shares trade at 18.7 times 2010 earnings compared with 73.7 times for the Tel Tech 50 index of technology companies listed on the Tel Aviv Stock Exchange, according to data compiled by Bloomberg.

Venture-capital funding in biotechnology companies jumped 46 percent in the second quarter, as investors looked to replenish their portfolios after an increase in acquisitions and initial public offerings.

Venture-capital investing across all sectors rose 19 percent to $7.5 billion in 966 deals, compared with $6.3 billion and 814 deals in the first quarter of 2011, the National Venture Capital Association and PricewaterhouseCoopers LLC said July 20 in a report. The three months that ended June 30 represented the biggest quarter for venture funding in two years.

Rate Unchanged

Israel, whose population of 7.7 million is similar to Switzerland’s, is home to the largest number of startup companies per capita in the world.

Israeli technology companies raised $569 million in capital during the second quarter of 2011, the most in two years and up from $343 million in the same period last year, according to the Israel Venture Capital-KPMG Quarterly Survey released July 13.

Israel’s stock market was upgraded to developed market status by MSCI Inc. in May 2010, the same month the 63-year-old country was accepted to the Organization for Economic Cooperation and Development.

Bank of Israel Governor Stanley Fischer left the benchmark interest rate unchanged at 3.25 percent yesterday as inflation expectations fell and debt crises in the country’s two main export markets, the U.S. and Europe, threatened economic growth.

The shekel strengthened 0.1 percent to 3.3936 per U.S. dollar. The currency has increased 6.4 percent over the past six months, the fourth-best performer among 10 emerging markets in Europe, the Middle East and Africa tracked by Bloomberg.

Allot Falls

Allot Communications Ltd. (ALLT) dropped 6.3 percent to $16.71 in New York yesterday, the lowest level in a month. The Tel Aviv- traded shares declined 2.6 percent to 56.76 shekels, or the equivalent of $16.72.

Israel’s biggest maker of high-speed networking equipment is planning a secondary offering of $70 million on Nasdaq, Ynet reported yesterday, without saying where it got the information.

Elbit Systems Ltd. (ESLT) gained for a fifth day in New York, the longest stretch of advances since April, rising 1.3 percent to $49.94. The Israeli stock was unchanged at 170.80 shekels, or the equivalent of $50.32.

Israel’s biggest non-government defense company received a $40 million order from the country’s Defense Ministry that is part of a total program valued at about $300 million, the company said in a statement to the Tel Aviv Stock Exchange yesterday.

Members of the Bloomberg Israel-US 25 Index:

Allot Communications Ltd.
Alon Holdings Blue Square Israel Ltd.
Cellcom Israel Ltd.
Ceragon Networks Ltd.
Check Point Software Technologies Ltd.
ClickSoftware Technologies Ltd.
Elbit Systems Ltd.
EZchip Semiconductor Ltd.
Fundtech Ltd.
Given Imaging Ltd.
Internet Gold-Golden Lines Ltd.
Ituran Location and Control Ltd.
Mellanox Technologies Ltd.
Ness Technologies Inc.
Nice Systems Ltd.
Orbotech Ltd.
Partner Communications Company Ltd.
Prolor Biotech Inc.
Protalix BioTherapeutics Inc.
Radware Ltd.
Retalix Ltd.
SodaStream International Ltd.
Syneron Medical Ltd.
Teva Pharmaceutical Industries Ltd.
Tower Semiconductor Ltd.

To contact the reporter on this story: Tal Barak Harif in New York at tbarak@bloomberg.net

To contact the editor responsible for this story: David Papadopoulos at papadopoulos@bloomberg.net

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