Gazit-Globe Ltd. dropped the most in more than two months after the multinational real estate company holds a share tender for institutional investors at a discount to yesterday’s closing price.
The stock of the Tel Aviv-based company dropped 3.7 percent, the most since April 9, to 49 shekels at the close in Tel Aviv, in 7.6 times the three-month average daily volume. The benchmark TA-25 Index slid 0.7 percent.
The company will offer 250 million shekels ($68 million) to institutional investors today, Clal Finance Underwritings Ltd. and Leader Underwriters (1993) Ltd. said in an e-mailed report today. The tender’s minimum price is 49.50 shekels a share, the underwriters said, a 2.8% discount to yesterday’s closing price. Gazit-Globe said yesterday after markets closed it’s considering a public share offering. A Gazit official, who asked not to be identified citing company policy, confirmed the tender would be held today.
“The company raises equity every year or two to maintain its leverage level in light of the 3 to 4 billion shekels it makes in new investments every year,” Noam Pincu, an analyst at Psagot Investment House Ltd., said today by phone from Tel Aviv. The shares are down because the offering is at a discount, he said. Pincu has a price estimate 59 shekels on the shares and recommends investors buy the stock, according to data compiled by Bloomberg.
Gazit, which spent 264 million shekels in the first quarter of the year for the acquisition of two income-producing properties and invested 365 million shekels in the development and expansion of projects, has $10 billion in long-term obligations, according to data compiled by Bloomberg. Net debt to total assets was 55.6 percent, as of March 31, compared with 56.1%, as of December 31, 2012, and 57.8% as of March 31, 2012, the company said on May 28.
Gazit has commercial and retail real estate in more than 20 countries including the U.S. and Brazil. Shares of Norstar Holdings, which owns a 54 percent stake in Gazit according to data compiled by Bloomberg, fell 5.9 percent, the most since 2011, to 99.9 shekels.