Rabbi's Prophecy Gem Explorer Said to Plan Unit's London IPOby
Chabad leader's vision leads to gemstone discovery in Israel
Shefa Yamim's stock has lost 86 percent since peak in 2013
Shefa Yamim, Israel’s first and only gemstones explorer, is seeking to raise as much as $20 million in an initial public offering of a unit on the London Stock Exchange, according to two people familiar with the matter.
The Netanya, Israel-based explorer, which trades on the Tel Aviv bourse, seeks to complete the listing of its unit Shefa Yamim (A.T.M.) Ltd. in the coming months on London’s Alternative Investment Market, said the people, who asked not to be identified because the plan isn’t public. The Tel Aviv-based investment bank Aloni-Haft Ltd. is managing the offering, in which the unit would be valued at more than $100 million, the people said.
Shefa Yamim is seeking to lure investor appetite in London after the stock in Tel Aviv plummeted 86 percent since an all-time high in February 2013, less than a year after it listed on the Israeli exchange. Its shareholders, who have already seen the company’s market value drop to about 63 million shekels ($16 million), may see their holdings diluted by the issue. Proceeds from the sale are expected to be used for further exploration activities, said the people familiar.
The company is prospecting for precious stones in the hills of northern Israel inspired by a prophecy of the late Rabbi Menachem Mendel Schneerson almost 30 years ago. “It has a sea, and it has a valley -- and in the valley are precious stones and gems,” Schneerson said in 1988, describing the northern city of Haifa. Abraham Taub, who founded Shefa Yamim in 1999 to fulfill the prophecy and became its chief executive officer, says the company has found diamonds and other gemstones including sapphires, moissanite and rubies, and is now close to assessing the commercial viability of the discoveries.
“The dollar value still needs to be determined and this is what we are hoping to do this year,” he said by phone from Netanya. “We expect to start mining within a year, at least in this specific primary location.” The company has identified as many as seven more sites where Taub anticipates taking large samples, he said.
This isn’t the first time Shefa Yamim has tried to issue shares in London. In 2008, it retracted an AIM offering due to market conditions. The exchange has attracted a growing number of international small-cap diamond, mining and gemstone exploration companies.
Schneerson, known to millions of orthodox Jewish admirers as the Lubavitcher Rebbe, was the late leader of the worldwide Chabad movement and is still revered by many of his followers as the Messiah despite his death 22 years ago.
“When I told people in the diamond industry that I am starting to work with Shefa Yamim they said: ‘Are you mad? They’re not going to find anything’,” William Griffin, a professor in geology at Macquarie University in Australia and a 20-year veteran of the industry, said during a visit to Israel. “I have already seen it and it is there. They have found a deposit but they need to define it more precisely including the economic viability and that will require more drilling and more money.”
Griffin examined samples provided by Shefa Yamim and found corundum stones that contained the mineral moissanite, a rare gem that resembles diamonds, and the even rarer tistarite, the company said in a filing to the Tel Aviv bourse on Jan. 27.
Shefa Yamim’s shares rose 5.6 percent, the biggest gain in three weeks, to 1.481 shekels at the close of trading in Tel Aviv.