Israel Corp. Gains as Plug Pulled on Car Unit: Tel Aviv Mover
Israel Corp. (ILCO), controlled by Israeli billionaire Idan Ofer, advanced the most in almost a week after its board decided against a further investment in its Better Place LLC electric cars venture.
Shares of the holding company, Better Place’s largest investor with a nearly 30 percent stake, advanced 3 percent to 2,271 shekels, the most since May 20, at 1:25 p.m. in Tel Aviv. The benchmark TA-25 Index (TA-25) rose 0.7 percent today, bringing its gain to 3.2 percent this year.
Better Place, backed by Israeli President Shimon Peres as a way to wean the world off oil dependence, filed a motion for liquidation in Lod district court today after failing to attract new investments, according to an e-mailed statement from the company. Israel Corp. said in a separate filing that it had decided against participating in a new investment round.
“Better Place would have needed further investment and the market did not believe it can produce value,” Guil Bashan, an analyst at IBI-Israel Brokerage & Investments Ltd. in Tel Aviv, said by phone. “This means Israel Corp. will not have to inject more money into the car unit and make better use of its funds, like investing to develop other businesses or return cash to shareholders.”
Israel Corp. shares have declined 7 percent this year as Canada’s Potash Corp. of Saskatchewan Inc. scrapped a proposed takeover bid for its Israel Chemicals Ltd. (ICL) unit, its Zim Integrated Shipping Services Ltd. presented a 5-year restructuring plan to banks and Better Place failed to attract more than a few hundred customers.
Better Place cars did not promise a significant savings over conventional sedans and batteries drained after about 100 miles, features that proved too big a hurdle to buyers. The Palo Alto, California-based startup, founded by former SAP AG (SAP) executive Shai Agassi, was in partnership with Renault SA (RNO) to build and operate electric-car charging networks and battery-swap stations and had raised $750 million since it was founded five years ago.
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