Mivtach Surges to 3-Year High on Tnuva IPO Bets: Tel Aviv Mover

Mivtach Shamir Holdings Ltd. jumped to the highest in more than three years on bets a potential initial public offering by its holding Tnuva Food Industries Ltd. would benefit the Israeli investment company.

Shares of Mivtach, which owns 21 percent of Tnuva, jumped 6.9 percent to 104.8 shekels, the highest since May 2010, at the close in Tel Aviv, and taking this year’s rally to 47 percent. Volume jumped to 19 times the stock’s three-month daily average. The benchmark TA-25 Index slipped 0.1 percent. The Israeli market is closed tomorrow for a holiday.

Tnuva, controlled by private equity fund Apax Partners LLP, is considering an IPO that would value the company at 8 billion shekels ($2.2 billion), a person familiar with the plans told Bloomberg yesterday, asking not to be identified because the discussions are private. The former kibbutz farmers cooperative was valued at $1.03 billion in 2007 after Mivtach and Apax bought a combined 76 percent percent stake.

“Shares are rising because of expectations of a high sale value for Tnuva,” Meir Slater, an analyst at DS Securities & Investments Ltd. in Tel Aviv, said today by phone. “This would lead to a higher valuation at Mivtach.”

The sale would be the largest listing in Israel since Azrieli Group raised 2.5 billion shekels in June 2010 to expand its real estate holdings. A listing at the valuation discussed would probably put Tnuva in the benchmark gauge with competitors Osem Investments Ltd. and Strauss Group Ltd., according to data compiled by Bloomberg.

The producer of dairy products has met with investment banks, including Clal Finance Underwriters Ltd., and is seeking a listing on the Tel-Aviv Stock Exchange by the first quarter of 2014, according to the person.

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