Bethel Finances: Merger to form Israel's biggest law firm

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Sources inform ''Globes'' that the Goldfarb, Levy, Eran, Meiri & Co. law firm, headed by managing partners Yehuda Levy and Oded Eran, is merging with the M Seligman & Co. firm, headed by Adv. Eli Zohar.

The firms will officially announce the merger today or tomorrow. The merger will create Israel's largest law firm, with 190 attorneys and 448 employees. It will oust Herzog Fox Neeman Law Office from first place, which it has held for several years, with 175 attorneys.

Goldfarb, Levy, Eran, Meiri & Co. is Israel's second largest law firm. It is engaged in all aspects of corporate and commercial law.

M Seligman & Co. is Israel's 15th largest law firm. It was founded in 1930, and one of Israel's top firms. It represents a wide range of government ministries and some of Israel's leading companies.

Zohar is one of Israel's foremost lawyers. His clients include former Prime Minister Ehud Olmert in the Talansky case, the Investments Promotion Center case, and other cases being heard at the Jerusalem District Court. Zohar is also the external legal counsel for the Ministry of Defense and he advises other state agencies on national security matters.

Bethel Finances: Teva takes over Japanese generics co Taiyo

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Teva Pharmaceutical Industries Ltd. (Nasdaq: TEVA; TASE: TEVA) announced today that it has signed a definitive agreement to acquire 57% of the shares in privately-held Taiyo Pharmaceutical Industry Co. Ltd. for $460 million in cash paid to private shareholders. Teva will also extend an offer to purchase all remaining outstanding shares of Taiyo. This transaction gives Taiyo an enterprise value of $1.3 billion. The transaction is expected to be accretive to GAAP earnings within four quarters after closing.

Taiyo is the third largest generic pharmaceutical company in Japan with sales of $530 million in 2010. According to Teva's announcement, the company has one of the most comprehensive generic product portfolios in the Japanese market with over 550 generic drugs in a variety of therapeutic areas and dosage forms. "Taiyo has strong presence in all major distribution channels in Japan, particularly in hospitals due to its wide range of injectable product offerings. Taiyo’s marketing efforts are supported by a strong back-end with top tier production capabilities in a wide range of technologies (including sterile manufacturing) in two manufacturing facilities, as well as a strong R&D team and local regulatory expertise," the announcement said.

Teva president and CEO Shlomo Yanai said, “This acquisition will enable Teva to deliver on our strategic objective of becoming a leading player in the fast-growing Japanese generics market. In fact, we now expect to reach our 2015 target of $1 billion in sales in Japan ahead of schedule. Taiyo’s strong market reach, cutting-edge production facilities, and impressively large product portfolio, combined with Teva’s scale and capabilities as the world’s largest generics company, will enable us to offer a much wider range of high quality, affordable generics to a much larger segment of the Japanese market.

“We have great respect for Taiyo’s legacy and its experienced, talented, and dedicated team and look forward to welcoming them into the Teva family.”

Japan is the second largest pharmaceutical market in the world, valued at $96 billion in 2010 with a relatively low rate of generic penetration of 23%. The Japanese government has expressed its intention to increase generic penetration to 30% by 2012.

Just two weeks ago, Teva announced the acquisition of US ethical drugs company Cephalon for $6.8 billion in cash, the third largest acquisition Teva has undertaken, after Barr in 2008 and Ivax in 2006, and its largest ever acquisition of an ethical drugs company.

Teva said that the Taiyo transaction would be funded through a combination of cash on hand and bank debt, and that it was expected to be completed by the end of the third quarter.

The acquisition was flagged two weeks ago by Japanese financial newspaper "Nikkei", which, hours after the Cephalon acquisition was announced, reported that Teva would buy Taiyo for 40 billion yen (about $495 million).

Teva shares closed at $49.67 in New York on Friday, giving the company a market cap of $44.36 billion.

Bethel Finances: Delek and Noble Energy in gas deal at record price

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A new threshold has been reached in the price of natural gas: $8.50 per million British Thermal Units (BTU) - the price reportedly reached in a contract yesterday between Yam Tethys partners Delek Group Ltd. (TASE: DLEKG) and Noble Energy Inc. (NYSE: NBL) and Hadera Paper Ltd. (AMEX: AIP; TASE: AIP). The higher price is reportedly due to the rise in the price of oil, אם which natural gas prices are partly linked, and to the fact that this is a short-term contract.

The price in the contract may reflect prices in upcoming large gas contracts with Israel Electric Corporation (IEC) (TASE: ELEC.B22) and Israel Corporation (TASE: ILCO), and it could affect the pricing of the Tamar and Leviathan gas reserves.

A notice to the TASE by Delek units Avner Oil and Gas LP (TASE: AVNR.L) (which owns 23% of Yam Tethys) and Delek Drilling LP (TASE: DEDR.L) (which owns 25.5%) states that the gas supply contract with Hadera Paper is for two years. The contract follows a five-year contract which expires at the end of June. Hadera Paper uses natural gas for its production and to operate a small power station. Delek and Noble Energy will supply the gas from Yam Tethy's Mari B well, offshore from Ashkelon.

The reason for the contract's short period is that Yam Tethys's reserves will deplete over the next two years, and it is due to be replaced by the Tamar reserves, which are due to come online in 2013.

Delek and Noble Energy will supply 210 million cubic meters of natural gas. The companies stated that the current value of the gas at the signing of the deal is $63 million, which equals $8.50 per million BTU, the highest price ever set in a natural gas contract with Israeli customers.

The price of gas in contracts with IEC, Dalia Power Energies Ltd., Dorad Energy Ltd., and Israel Corp. ranged from $4 to $5.50 per million BTU.

Delek Group's share price rose 1.4% in morning trading to NIS 887.70 Delek Drilling's share price rose 0.6% to NIS 12.57, and Avner's share price 0.6% to NIS 2.19.

Bethel Finances: Ex-Mossad chief Halevy: Negotiations with Palestinians impossible

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Former Mossad chief Ephraim Halevy told the Knesset Foreign Affairs and Defense Committee that negotiations between Israel and the Palestinian Authority were impossible. The committee discussed the pending unilateral UN declaration of an independent Palestinian state in September.

Halevy warned, "The area for maneuver is shrinking and the ability of the Quartet (the US, EU, Russia, and the UN) to influence the negotiations is declining." He added that what Israel wanted in the past two years is not longer achievable.

"It's impossible to reach a permanent settlement because it's impossible to hold negotiations on a permanent settlement and not implement it because whoever signs an agreement on the Palestinian side won't be the man who implements it," Halevy said.

Former Israeli Ambassador to the UN Prof. Gabriella Shalev painted a bleak diplomatic picture. "Our standing in the UN is at a nadir. This nadir began with Operation Cast Lead and who knows when it will end," she said, adding, "The unilateral declaration by the Palestinians is not the objective - I see it as a step, an interim objective by the Palestinians to bring about our collapse in the eyes of the world."

Shalev said that Israel must make a diplomatic effort to persuade countries that "a unilateral declaration, if made, is a step with no advantage for Palestinians, and will unquestionably damage the peace process."

Foreign Affairs and Defense Committee chairman MK Shaul Mofaz (Kadima) said, "The Israeli government has its head in the sand. Without a diplomatic initiative, yesterday's events will be repeated in September." He added that Prime Minister Benjamin "Netanyahu's government has lost the initiative. It must prepare for any scenario. It can, and must, explain its positions."

Mofaz concluded that the government's conduct has resulted in Israel's isolation and being driven out of the consensus. "The prime minister is stuck in a reality in which he goes to the US to try to rescue Israel from the situation he has put it in."

Bethel Finances:Israel Railways, workers agree strike-free period for talks

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At the end of a long hearing at the Tel Aviv District Labor Court today, representatives of Israel Railways management and workers committee agreed that they would hold talks through July 1, during which period no strikes or labor disruptions will take place. At the same time, management will not take any unilateral measures.

Under the agreement, which received the status of a court decision, the parties will notify the court of the progress of the talks every ten days. Senior Ministry of Transport officials and Histadrut chairman Ofer Eini will participate in the talks.

The talks will cover train safety, implementation of the public sector salary agreement, and management's plan to privatize Israel Railways' maintenance network.

The workers committee welcomed the agreement, saying, "All we wanted was for them to talk with us, and it's a pity that we achieved this only through the courts."

As "Globes" reported yesterday, Eini decided to use all his power and prestige to prevent the privatization of Israel Railways' maintenance network. At the real estate conference held by Hebrew business daily "Calcalist" this morning, he said, "A month ago, I heard the transport minister speak in a militant manner and threatening to shut down the railways over safety. I haven’t spoken to the media until now in order to give a chance for dialogue, but I tell the transport minister unequivocally that you will find me and the Histadrut full partners on the matter of safety. Passenger safety is important, and we will contribute all we can on this matter. However, if all the talk about safety is meant to conceal the privatization of the railways, I tell you that you will face my full power."

Bethel Finances: Obama to propose dividing Jerusalem

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"Israel must return to its 1967 borders," US President Barack Obama is expected to declare on Thursday in his Middle East policy speech, Israeli daily newspaper "Yediot Ahronot" reports this morning. Obama will propose dividing Jerusalem between Israel and the Palestinian Authority but will rule out supporting any unilateral declaration of Palestinian independence.

From conversations over the past few days between Israel's new national security advisor Yaakov Amidror and his predecessor Uzi Arad with senior figures in Washington, the newspaper claims to have details of the draft plan that Obama intends putting forward. In his speech on Thursday, Obama will outline the main principles of his Middle East approach, and call on Israel and the Palestinians to return to the negotiating table.

While Obama will call on the Palestinians refrain from declaring unilateral independence in September, he will also demand that Israel stop building West Bank settlements.

On the subject of Jerusalem, he will say that from the US point of view the city should be the capital of two state that live alongside each other in peace. Obama will reportedly adopt the plan of former US President Bill Clinton in which Jerusalem's Palestinian neighborhoods will be part of Palestine, and neighborhoods in which there is a majority of Israelis will be part of Israel.

Bethel Finances: Tower reports 6% revenue growth

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Specialty foundry Tower Semiconductor Ltd. (Nasdaq: TSEM; TASE: TSEM) posted revenue and non-GAAP net profit growth for the first quarter of 2011, but declined to provide guidance for the second quarter, citing uncertainties over the closing date of its acquisition of a Japanese foundry from Micron Technology Inc. (NYSE: MU) and the subsequent consolidation of revenue.

Tower (which operates under the TowerJazz brand) posted $120.6 million revenue for the first quarter, 6% more than the $113.8 million for the corresponding quarter of 2010. The company said that its growth was "in line with industry trends."

GAAP-based net loss narrowed nine-fold to $5.4 million ($0.02 per share) for the first quarter from $36.2 million for the corresponding quarter. Non-GAAP net profit rose 19% to $31.5 million ($012 per share) from $26.4 million. Non-GAAP earnings per share met the the analysts' consensus.

Tower had $184 million in cash and short-term deposits at the end of March, $101 million more than a year earlier.

Tower CEO Russell Ellwanger told "Globes", "Our revenue rose very strongly, but there is some weakness in the mobile phone segment. The company's momentum isn't based on any single quarter, but on long-term trends. We have very large contract with some customers, which will give us substantial market share. We'll see the results in 2012-13."

"Globes": What is your full-year guidance?

Ellwanger: "The forecast for the industry as a whole was 6% growth, and we believe that we'll double this. In other words, we'll have $570-580 million revenue this year."

The guidance is above the analysts' full-year revenue consensus of $557 million.

What about the share price?

"I can't explain the fall in the share price. Our entire industry is fairly weak in terms of shares. I can tell you that the company continues to grow very strongly, and I believe that, at its current price, the share is very attractive. I'm doing everything to improve the company's condition. Analysts and investors should look at what management says and if it meets it targets. Time will do its thing, and in the long term, I believe that the share price will reflect the company's true value."

Tower's share price fell 4.8% on Nasdaq yesterday to $1.20, giving a market cap of $318 million and was umchanged in early trading on the TASE today at NIS 4.31.