Tower Semiconductor Ltd. (TSEM) tumbled to a four-year low in New York, narrowing its premium to the Tel Aviv stock, as the Israeli chipmaker carried out a share offering for existing holders.
The stock plunged 4.4 percent to $4.78 in U.S. trading, trimming the gap over the shares in Israel to 2.6 percent and extending this year’s tumble to 39 percent. The Bloomberg Israel-US Equity Index slid to a two-month low as four stocks fell for each that rose. MagicJack (CALL) VocalTec Ltd., whose founders pioneered voice-over-Internet technology, sank to the lowest in three months. Cellcom Israel Ltd. (CEL) added 2.3 percent.
Tower, whose $60 million rights offering ends this week, said in a statement that the offer will boost the amount of equity outstanding by at least 5.3 percent to more than $200 million. The Migdal Haemek, Israel-based company has posted losses for six straight quarters and revenue for the first three months of the year missed analysts’ estimates.
“We haven’t really seen any kind of stabilization yet,” Andrew S. Zamfotis, an analyst at EVA Dimensions in New York who rates Tower sell, said in a telephone interview yesterday. “It looks like it’s going to continue to trend lower.”
The Bloomberg Israel-US gauge dropped 1.6 percent to 88.78 yesterday, the lowest level since April 26. The TA-25 Index (TA-25) lost 1 percent, slumping a fifth day in the longest losing streak since November 2011.
Tower fell to the lowest level since June 2009 in New York, while its Tel Aviv-listed shares lost 2.7 percent to 16.90 shekels, or $4.66.
MagicJack, based in Netanya, Israel, sank 5.9 percent to $13.79, the lowest price since March 26. The stock extended its plunge this year to 24 percent.
Cellcom, Israel’s largest mobile phone provider, posted the biggest gain among the nation’s biggest companies traded in New York. The shares jumped to $9.07, widening its premium to the Tel Aviv stock to 0.7 percent.
The Bank of Israel left the benchmark lending rate unchanged at 1.25 percent yesterday. after reducing it twice last month. in the final monetary policy decision steered by Governor Stanley Fischer, who is stepping down at the end of the month. He will be replaced by Jacob Frenkel, chairman of JPMorgan Chase International, who served as governor of the central bank from 1991 to 2000, Prime Minister Benjamin Netanyahu announced June 23.
To contact the reporter on this story: Jessica Summers in New York at firstname.lastname@example.org