Tel Aviv, December 18,2019 - At the first press conference the Tel-Aviv Stock Exchange (TASE) has held since becoming a public company listed on TASE, Ittai Ben-Zeev, TASE's CEO, today summarized the past year's activities and shared a glimpse into the major measures that TASE is planning for 2020. TASE is continuing to concentrate on a focused endeavor to achieve three main goals that were defined in the strategic plan it introduced three years ago: making the Israeli economy more transparent, enhancing liquidity and expanding its services.
During the years 2017-2019, 35 new companies joined TASE, raising a total of NIS 8.1 billion; this compares to just 10 companies in the years 2014-2016 that raised a total of only NIS 1.8 billion. This year, seven new companies joined TASE, raising NIS 3.2 billion; of these, five were large companies that have been included in the TA-90 Index. Among the IPOs that took place this year, the NIS 1.8 billion raised by Isracard, was particularly noteworthy due to its size. Other major companies that performed IPOs this year were Yochananof, Altshuler Provident, FreshMarket, and TASE itself.
In addition, three new companies that are listed in the United States dual listed in Tel Aviv during the course of the year. On top of this, 8 new companies registered on TASE by means of incorporating their activities within reverse merger companies (registered stock exchange companies not having any business activities).
Continuing the trend seen in previous years, resulting from the indices reform, the free float percentage has continued to rise and stood at 59% at the end of the year, compared to only 46% at the end of 2014. This year, the scope of shares sold by interested parties amounted to more than NIS 5.5 billion. Overall, the scope of the free float has increased by 28% in the last five years.
NIS 65.5 billion was raised in corporate bond offerings to the public and institutions and a further NIS 3.3 billion was raised in structured bond offerings. Three new bond issuers were registered this year, raising NIS 1.6 billion; among these was the government company – “Mekorot". 564 ETFs are traded on TASE and, for the first time, 23 foreign funds of “Blackrock" have been listed. The “Blackrock" funds are also traded overseas and provide the Israeli public with a broader exposure to global investment. The value of the public's holdings in ETFs amounts to NIS 94 billion.
The most significant event during the past year was TASE's own IPO and it becoming a public company listed on the Tel-Aviv Stock Exchange – similar to the status of many of the world's leading stock exchanges that operate as public companies.
Mr. Ben-Zeev commented at length about the unique features of the global IPO made by TASE, which based the offering on a first-of-its-kind model: the “Tel Aviv-Global model", which provides a response to the unique needs of IsraGlobal companies – companies that have a strong Israeli core, but are also engaged in global activities, that desire exposure to international investors as well as to Israeli investors, and that have a need to be evaluated by international bodies. We have proved that a Win-Win model as possible – borders can be breached and a local offering (in its natural location in Israel, close to its employees and its operational core) can be integrated with exposure to leading international bodies, valuations therefrom and partnership therewith".
Mr. Ben-Zeev continued: “an IPO according to this integrated model contributes significantly to our ability to offer Israeli companies, particularly high-tech companies, innovative opportunities to raise capital; hence, TASE will be able to better reflect the Israeli economy and to ensure that not just Bob Smith from Minnesota, but also Yael Cohen from Tel Aviv, profits from the success of Israeli innovation".
In all, TASE raised a total of NIS 225 million – at a value of NIS 710 million – in its IPO. Using the Tel Aviv-Global model, the IPO was led by the global investment bank, Jefferies, with the participation of leading international bodies that were able to set the value in relation to other stock exchanges around the world and in relation to the growth potential from an international perspective. The Israeli public participated in the offering at the same price as institutional investors but with limits on the amount, so that access to the offering would also not be in large amounts. Most of the holdings in the Tel Aviv Stock Exchange are currently in the hands of the public – both Israeli and overseas investors.
Mr. Ben-Zeev remarked on the fact that, in less than a decade, $112 billion has “evaporated" from Israel due to companies having been sold rather than being turned into independent companies. During the past year, TASE has also placed emphasis on developing and varying dual-listing options, which makes it possible for Israeli and foreign companies to raise capital and to create liquidity in Israel and overseas, without subjecting themselves to additional regulatory requirements, with a range of registration alternatives at various stock exchanges in the United States, Hong Kong, Singapore, London, and Toronto. In 2019, approximately 40% of dual-listed companies' trading volume takes place in Tel Aviv. 29% of this year's average daily trading volume was in respect to the dual-listed companies, which have a total market cap of NIS 276 billion.
The average daily trading volume in equities (including ETFs) amounted to NIS 1.3 billion and the average daily trading volume in bonds (including ETFs) amounted to NIS 3.5 billion. The daily trading volume showed a decline compared to last 2 years. In 2020, TASE intends to place considerable emphasis on the subject of enhancing liquidity – one of its strategic goals. Just this week, TASE announced a new plan for improving the capital market's transparency and for enhancing liquidity, which includes restricting off-exchange transactions and internal transactions, similar to international regulations, and creating incentives for market-making in TA-35 shares.
In 2019, TASE invested considerable resources in its public relations and information activities, with the long-term aim being to remove barriers and to encourage the public to take a more active role in the Israeli capital market. In addition, a number of measures were taken this year to lower prices and improve public access to market data, to increase the number of TASE members and to encourage the entry of new market participants. During the course of the year, TASE also undertook several technological infrastructure projects to enhance accessibility, such as Global Access Points and Co-location.
TASE Annual Review and Outlook - Press Conference Presentation