Company Cooling Holdings It is no longer able to get its hands on the minority holdings in the soft drink company Yafora, while at the same time working to realize some of its holdings in the other company it owns – the frozen chips manufacturer Industries Will expire.
A statement issued by Karur states that Tapogan Industries submitted a first draft of the Securities Authority and the Tel Aviv Stock Exchange Sale offer prospectus, According to which the public will be offered shares of Tapogen held by the current shareholders in Tapogen, including Karur itself.
Karor, which is controlled by Shlomo Rodev and Roni Gat, holds about 70% of the soft drink maker’s shares Yafora And in 37.74% of the shares will expire. Yafora itself owns 50% of the Ein Gedi mineral water company, as well as 30% of the Green Pet plastic bottle recycling company. The market value of Karur Holdings is NIS 1.26 billion (Rodev and Gat’s share is about 62%).
Tapogan is engaged in the production of frozen French fries and frozen potato products, intended for the retail and professional markets. In 2020, Tapogan showed a growth of 11.6% in revenues to NIS 165.9 million and beyond a net profit of NIS 8.4 million. This is compared to the loss of NIS 4.2 million presented by Tapogan in 2019.
Tapogen’s shareholders ‘equity amounted to NIS 142.5 million at the end of 2020, compared with NIS 134.1 million at the end of 2019. In the quarterly reports for 2021, Karur does not list Tapogen’s financial results, but only indicates its share in the companies’ treated equity (net) method. NIS 7.5 million, when it comes to summing up the profits of Tapogan and Ein Gedi (excluding Green Pet, which lost NIS 2.9 million during this period).
The other shareholders in Tapogan are Shuki Sharon and Kobi Porat’s Tupap Company. At the beginning of 2015, the Kedma Investment Fund proposed acquiring the holdings of Sharon and Porat in Tapogan and becoming its controlling shareholder at a company value of NIS 250 million. However, an objection filed by Karur Holdings ultimately prevented the completion of the transaction and led to a protracted dispute between the partners, which also concerned Sharon and Porat’s demand for a dividend distribution by Tapogan – which Karor also objected to.
At the beginning of 2019, Karur and its partners decided, on the recommendation of the court, to end the disagreements between them and now the three partners are seeking to realize part of their holdings through an IPO. The planned IPO will indeed go ahead.
Clal Beverages rejects the refrigeration offer
Meanwhile, Clal Beverages announced that it was rejecting Cooling Holdings’ offer and would not sell its shares (30.45%) in Yafora for NIS 450 million. Following the decision to postpone, Clal Beverages and Refrigeration will continue to hold Yafora shares together.
Karur submitted the proposal last month, which reflected a value of about NIS 1.48 billion for Lipora. It was the second time in the last four years that Karur has submitted an offer to buy the minority shares in Bifora, but as for the first time, the offer was rejected for the second time.
According to Clal Beverages, its board of directors is conducting an in-depth examination of a refrigeration proposal, with the assistance of a number of external consultants. In this context, Clal Beverage’s Board of Directors was presented with an external appraiser’s work, which determined that the fair value of holding Clal Bifora drinks significantly higher than the offer submitted by Karur Holdings, even with stringent assumptions and possible regulatory changes that could adversely affect Yafora and its operations.
Clal Beverages also stated in the announcement that the company had received indications from a number of institutional entities holding a substantial share of its shares, according to which the proposed consideration does not reflect the fair value of the company’s holdings in Bifora.
The list of institutional entities that hold a significant share of Clal Beverages shares currently includes Altshuler Shaham (19.06%), Harel Investments (16.99%), Clal Insurance (15.43%), Phoenix-Excellence (8.63%) and Willin Lapidot (6.22%).
Following the decision, a meeting was held between Clal Beverages ‘representatives and Refrigeration’s representatives, during which Clal Beverages’ representatives presented the company’s position regarding the offer and the fair value of the holding in Bifora. After the meeting, Karur did not raise its offer and therefore Clal Beverages announced that it had rejected the offer.
As early as April 2018, Karor submitted an offer to purchase the remaining shares of Yafora, which were then held by Clal Industries of Len Belvatnik, for NIS 375 million and at a value of NIS 1.2 billion for Lippora. However, Clal Industries then rejected the offer and led a move to issue it on the Bipora minority holding exchange.
As part of the same move, Clal Industries transferred the entire holding in Bifora to a wholly owned subsidiary called Clal Industries and Beverages, and later sold some of the shares in Clal Industries and Beverages to investors on the stock exchange. The issue and sale of the shares were then carried out by way of a sale offer, in which Clal Industries then sold about 46% of the shares of Clal Industries and Beverages for about NIS 230 million and at a company value of about NIS 500 million.
Clal Industries, which remained after the IPO with 54% of Clal Beverages ‘shares, has since continued to sell shares in its holding and currently holds only 13.9% of Clal Beverages’ shares, which are currently traded on the stock exchange at a value of NIS 393 million.
Growth and recovery from the corona crisis
Yafora’s revenues for the first nine months of the year grew by 10% to NIS 746 million. The company, which manufactures and markets, among other things, Schweppes, Spring, Crystal, Tapuzina and other products, attributes the growth to an increase in demand and the recovery of the economy from the corona crisis.
Yafora’s operating profit grew by 5% to NIS 131 million in the first nine months of 2021, while operating profit before depreciation and amortization (EBITDA) increased by 7% to NIS 177 million.
In the bottom line, in the first nine months of 2021, Yafora recorded a 17% growth in net profit to NIS 104 million, which was also positively affected by a gain on the increase in value of tradable securities it owns in the amount of NIS 7 million. For comparison, in the first nine months of 2020, the company recorded a loss due to a decrease in the value of marketable securities in the amount of NIS 8.5 million, which affected its results.