Debt Raise Plan Causes Africa Israel Properties’ Gain

The renowned Real Estate Developer, Africa Israel Properties has advanced to its highest figures within last 2 years. The company has announced that it is seeking to raise the debt and this helped to boost the investors’ bets as far as the project financing capabilities of the company is concerned.

The share prices of Africa Israel Properties actually jumped up by 7.9% and each of the shares is currently priced at 41.48 shekels. This marks the highest figure of the company’s shares since May, 2011. Incidentally, Africa Israel Investments Ltd. holds a total stake of 56% in the company and it also experienced surges on today. It actually advanced by 2.4% and each share is currently priced at 9.025 shekels. The benchmark index of Israel, however experienced a decline of 0.3% and the yield on the 5.9% bonds which are due by July, 2019, increased by 7 basis points. These are at 6.35% currently.

Africa Israel will be seeking an extension of the July, 2019 bonds, as announced by the company representatives. This extension is expected to generate around 130 million Shekels worth of Bonds in a private placement to the institutional investors, as far as the filing made on the Tel-Aviv Stock Exchange on today is concerned. In 2013, the shares of the company have seen an increase of 17%. The benchmark gauge of the index however has risen by 1.4%. The real estate developer has recently expanded its business in both Israel and Europe. The company made a presentation on its earnings in last November and that stated that the property rental income has increased by 5% in 2012’s first 9 months. Apart from that, the net operating income has also increased by 7% and is at 236 million Shekels in that timeframe. The total equity of the company by the end of 2012’s 3rd quarter was 2.7 billion Shekels.

Psagot Investment House’s analyst, Noam Pincu, stated that Africa Israel’s decision has brought positive sentiments in the market. Noam added that the debt extension decision proves it to the investors that Africa Israel is capable of raising money for financing some more projects without any sort of need to sell the assets. In last February, the bond outlook of the company was raised from stable to positive by the Moody’s Midroog and the Baa1 rating was maintained as well.