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International Investors and Israeli companies

International Investors and Israeli companies. Darren Shaw : +972-9-960-0113. June, 2007. Contents. Importance & benefits of international investors What concerns international investors Israeli companies and int’l investors – comparison with other countries

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International Investors and Israeli companies

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  1. International Investors and Israeli companies Darren Shaw : +972-9-960-0113 June, 2007

  2. Contents • Importance & benefits of international investors • What concerns international investors • Israeli companies and int’l investors – comparison with other countries • UBS Israel’s Top 10 suggestions for a good CFO to attract int’l investors

  3. Importance & benefits of international investors • We estimate int’l investors account for 30-70% of the volume of the TA25 and TA100 • Stocks with large int’l following typically trade on higher multiples • Companies who consistently meet int’l investors are able to reduce risk of stock overhang • Examples • Important to be covered by global houses and be compared with international peers

  4. What concerns international investors? • Politics • Geo Politics • Economics • Company Specific

  5. 1) Internal Politics • Stability of Country despite weakness of Olmert’s Government • Netanyahu well liked so risk of new elections changing the economy etc low • Compare to Turkey, Russia • Does it matter?

  6. 2) Geo Politics • Key message – Geo political risk lowered • This is why market has been so strong since the 2006 Lebanon War • Int’l investors reacted during Intifida, but not during 2006 Lebanon War • Int’l investors have started to live with risk • Not concerned by Gaza, Hezbullah, Hamas nor Iran

  7. 3) Economics • Economy on auto-pilot, good GDP growth, low risk of disappointment • Most investors in Israel comparing to Russia, turkey etc which are higher risk • Resilience – investors positively surprised by economy post war • Other positives, currency, interest rates, inflation, current account, FDI

  8. Israeli companies and int’l investors – comparison with other countries • Transition from local to global market place • Global issues remain a risk • Expect closer correlation with global markets than before

  9. What do investors focus on? • Mainly focus on TA-25 • Of these, most traded are Teva, Banks, Chemicals • IPOs, Secondary Listings, Block Trading • Strong investor relations • ENGLISH !

  10. What do investors want? • Free float, liquidity • Access to senior management • English speaking, SIMULTANEOUS English press releases, English conference calls • Transparency, disclosure, honesty • Roadshows with senior management • Impressive CFOs and CEOs with good English who explain strategy

  11. UBS Israel’s Top 10 suggestions for a good CFO to attract int’l investors • Increase free-float • Block trades with shares sold to int’l investors • Strengthen investment in investor relations (guaranteed success!) • User expertise of global investment houses • Regular roadshows with senior management • Don’t hide the key people! • Be available for key analysts and investors • Explain strategy • Widen investor base • THINK ENGLISH (English speaking, press releases, conference calls)

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