Elzstain and Ben-Moshe injects $47 million into IDB Development

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 The two are exercising warrants at 43% above Thursday’s closing price. IDB Development shares are rising strongly.

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The controlling shareholders in IDB Development Corporation, Moti Ben-Moshe and Eduardo Elsztain, announced on Friday that they would inject about $46.93 million into the company by exercising warrants on about 32 million shares at a strike price of NIS 5.5 (about $1.46) per share.

The exercise of the warrants that the two acquired in the rights issue held in July is at a price some 43% higher than Thursday’s closing price of NIS 3.85 (about $1.026) . IDB Development’s share price has shot up by 8.57% on the Tel Aviv Stock Exchange this morning, to about $11.14.

Elsztain said, “I decided on exercising the warrants with the aim of strengthening the company. As an owner of IDB I see this as part of my commitment to and responsibility for supporting the company all the way. I believe that this injection of cash will mean a significant boost to the company’s financial strength. My investment is for the long term, and I therefore decided to exercise the warrants even though this is at a higher price than the market price. I think that there can be no better demonstration of the great faith I have in the company and the potential I see in it.”

Ben-Moshe said, “Through the exercise of the warrants it is proved once more, not in words and headlines but in actions and with hundreds of millions of shekels, that we stand by all the commitments we undertook towards the investors. We have the ability and the financial strength, we have the will, and, more importantly, we are both determined to retore IDB Development to its rightful plac in the Israeli economy.”

Published by Globes [online], Israel business news – www.globes-online.com