MIRA INFORM REPORT
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Report Date : |
23.01.2012 |
IDENTIFICATION DETAILS
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Name : |
DEAD SEA BROMINE COMPANY LTD. |
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Registered Office : |
P.O. Box 180, Beer Sheva
(84101), 12 Kroitzer Street, Makleff
House, Beer Sheva 84894 |
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Country : |
Israel |
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Financials (as on) : |
30.09.2010 |
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Date of Incorporation : |
16.06.1955 |
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Legal Form : |
Public Limited Company |
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Line of Business : |
Subject is part of ICL Industrial Products (ICL-IP), heading the Dead Sea Bromine Group (known as “DSBG”) |
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No. of Employees
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10,625 |
RATING & COMMENTS
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MIRA’s Rating : |
A |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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56-70 |
A |
Financial & operational base are regarded healthy. General unfavourable
factors will not cause fatal effect. Satisfactory capability for payment of
interest and principal sums |
Fairly Large |
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Status : |
Good |
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Payment
Behaviour : |
No Complaints |
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Litigation : |
Clear |
NOTES :
Any query related to this report can be made
on e-mail : infodept@mirainform.com
while quoting report number, name and date.
ECGC Country Risk Classification List – September 30th, 2011
|
Country Name |
Previous Rating (30.06.2011) |
Current Rating (30.09.2011) |
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Israel |
a2 |
a2 |
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Risk Category |
ECGC
Classification |
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Insignificant |
A1 |
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Low |
A2 |
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Moderate |
B1 |
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High |
B2 |
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Very High |
C1 |
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Restricted |
C2 |
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Off-credit |
D |
Company name & address
DEAD SEA BROMINE COMPANY LTD.
(Known
as DSBG)
Telephone 972 8 629 76 00
Fax 972 8 629 78 44
P.O.
Box 180, Beer Sheva (84101)
12 Kroitzer Street,
Makleff House
BEER SHEVA -84894 ISRAEL
HISTORY &
LEGAL FORMATION
Originally incorporated as a private limited company
and registered as such as per file No. 51-013749-0 on the 16.06.1955.
Converted into a public limited company and registered
as per file No. 52-003580-9 on the 30.07.1986.
At a later date
subject published a prospectus offering shares to the public.
In November 2000
parent company, ISRAEL CHEMICALS LTD., following a successful tender offer for
its shares, reached full ownership over subject after it acquired 10.8% of the
shares from the public in consideration of NIS 270 million.
Consequently,
subject was de-listed from trading on the Tel Aviv Stock Exchange and during
2001 re-converted into a private limited company
(though latter registration number remains).
SHARE CAPITAL
Authorized share capital NIS 100,000,000.00, divided
into -
99,999,999 ordinary shares
(88,600,077 shares issued),
1
special share (issued), all of NIS 1.00 each,
of
which shares amounting to NIS 88,600,078.00 were issued.
SHAREHOLDERS
Company is fully owned
by ISRAEL CHEMICALS LTD. (ICL), a public limited company whose shares are
traded on the Tel Aviv Stock Exchange (TASE).
ICL is controlled
(52.4%) by THE ISRAEL CORPORATION LTD., also publicly traded on TASE,
controlled (some 52%) by the OFER Group, owned by the Ofer
family, and controlled by Idan Ofer (mainly) and
POTASH CORPORATION
OF SASKATCHEWAN (PCS) holds 13.9% of ICL (during March 2010 invested some NIS
1.5 billion in 2.5% of ICL shares).
The State of
Israel holds one single special share in subject, given the fact subject holds
rights on Israel national resource.
In December 2011
it was published that PCS is negotiating increasing its stake in ICL to 25%,
and approached the State of Israel for permission for such act (since ICL's holds
Israel national resources concession).
DIRECTORS
1. Nir Gilad - Chairman of ICL,
2.
Akiva Moses -
Chairman of subject and CEO of ICL,
3.
Eli Amit,
4.
Yossi Rosen,
5.
Amnon Sadeh,
6.
Avisar Paz,
7.
Ehud Buch,
8.
Yossi Lastigson,
9.
Shlomo Maoz,
10.
Amir Makov,
11.
Yair Orgler,
12.
Asher Greenbaum,
13.
Yosi Shachar,
14.
Avi Dueitchman,
15.
Avraham (Beiga) Sochat (former Minister of
Finance).
GENERAL MANAGER
Nissim Hadar (also
of subsidiary BROMINE COMPOUND)
BUSINESS
Subject
is part of ICL Industrial Products (ICL-IP), heading the
DEAD SEA BROMINE GROUP (known as “DSBG”). ICL-IP sales comprised some 23% of ICL total 2010 (some 22% in 2009 and
18% in 2008).
Mainly via
wholly-owned subsidiary BROMINE COMPOUNDS LTD., operating as manufacturers,
exporters and marketers of bromine compounds and other industrial chemicals
based on minerals extracted from the Dead Sea, the world’s largest bromine
source (methyl bromide, sodium, potassium and ammonium bromides, etc.), for
agricultural and industrial purposes, mainly plastics
industry and chemicals for oil/gas drilling, etc. and are also used as flame
retardants, mainly for the electronics industries.
98% of sales are
to overseas markets.
Yearly production capacity of Bromine Compounds is of 400,000 tons (149,000 tons produced in 2009) and
280,000 tons of Elementry Bromine (128,000 tons produced in 2009).
Most of ICL-IP products are bromine-based (the rest is chlorine-based,
magnesia-based and others). Most of the bromine extracted is for ICL own
production (76%), the rest is sold to 3rd parties.
Among local
suppliers: SIG INDUSTRIES, PETRUS TECHNICAL SUPPLY, ATEKA, AMGAL CHEMICALS,
MODCHEM, LEAD CONTROL, A.D. SINUN, YAMATON, HAL DOR IMPORT, PURE CHEMICALS,
APPLIED CHEM, SEVEN SEAS SHIPPING (shipping services), E.S.T. PROJECTS, etc.
The DSBG Group is
operating from main offices in Maklef House, 12 Kroitzer Street, Beer Sheva.
Plants are situated in Sodom (at the Dead Sea shores), in the Industrial Zone,
Beer Sheva, a large plant in Ramat Hovav (BROMINE COMPOUNDS plant) and the DSP
plant in Mishor Rotem (near Dimaona).
ICL-IP
also operate from plants in the USA, China, Germany, France, Ireland and in
the Netherlands, as well as from a Logistic Center in the Netherlands, and from
marketing and service offices in several other countries.
There are 10,625
employees in the ICL Group (of which some 5,000 employees in Israel), of which
2,567 employees in ICL IP Division, to which subject belongs.
MEANS
Financial data is
included in the consolidated statements of parent company, ISRAEL CHEMICALS
LTD., which shows:
US$ (thousands)
ASSETS 30.09.2010 31.12.2009
Current assets:
Cash and cash equivalents 307,880 257,970
Investments, deposits and
short term loans 214,022 167,549
Customers 969,365 969,620
Other receivables 182,285 143,106
Stock 1,053,662 1,233,250
2,727,514 2,771,495
Non-current assets:
Investments and other
non-current assets 494,969 476,278
Fixed assets 2,162,824 2,093,133
Intangible assets 549,411 566,683
3,207,204 3,136,094
5,934,718 5,907,589
======== ========
LIABILITIES
Current Liabilities 1,122,256 1,169,617
Non-current liabilities 2,278,666 1,943,123
Equity 2,533,796 2,794,849
5,934,718 5,907,589
======== ========
ICL current market
value US$ 13,400 million.
Subject is an
“Approved Enterprise”, and as such enjoys State benefits. Subject received approval from the Israeli Investment
Centre (IIC) for a US$ 50 million expansion plan for the Bromine plant in
Sodom. In November 2000, the IIC approved
investment plans for subject (jointly with other members of ICL) for the sum of
US$ 140 million.
Total
assets of ICL-IP as of 31.12.2010 summed up to US$ 1,540.4 million (was US$
1,441.3 million as of 31.12.2009).
On the 04.12.2011
ICL signed an agreement with 7 international banks to receive a line of credit
of US$ 650 million.
There
are 3 charges for unlimited amount registered on the company's assets, in
favour of the State of Israel and CRYSTAL PURCHASING LTD.
REVENUES
Subject pays
royalties to the State of Israel as part of the rights given for mineral production
from the Dead Sea.
ICL-IP 2009 sales
were US$ 1,015.1 million, making a gross profit
of US$ 236.5 million and an operating profit
of US$ 20.9 million.
ICL-IP 2010 sales
were US$ 1,313.2 million, making an operating profit
of US$ 206.6 million.
ICL-IP 2011 first
9 months sales were US$ 1,178 million (21.9% increase from 2010), making an operating profit of US$ 234.2 million.
ISRAEL
CHEMICALS LIMITED
Consolidated
Statement of Income
US$
(thousands)
Year
ended 31.12
2008 2009 2010
Sales 6,904,049 4,554,316 5,691,537
Gross profit 3,445,275 1,836,530 2,432,076
Operating income 2,335,489 938,173 1,346,127
Income before taxes on
income 2,227,209 942,806 1,295,423
Net income 1,993,968 774,314 1,028,617
======== ======== ========
ICL consolidate sales for the first 9 months
of 2011 were US$ 5,355.5 million (25.4% increase compared to the parallel
period in 2010), making a gross profit of US$ 2,380.2 million, an operating
profit of US$ 1,459.5 million, and a net profit of US$ 1,149 million.
Subject
ended 2008 with a consolidated net profit of US$ 30,852,000.
Subject
ended 2009 with a consolidated net profit of US$ 67,286,000.
Subject
ended 2010 with a consolidated net profit of US$ 73,699,000.
OTHER COMPANIES
Subject’s subsidiaries
(100% unless otherwise stated), part of ICL Industrial
Products (ICL-IP), among many others:
BROMINE COMPOUNDS
LTD., 100%,
BROMINE COMPOUNDS
MARKETING (2002) LTD., 100%,
TETRABROM
TECHNOLOGIES LTD., 50%,
CHEMADA FINE
CHEMICALS LTD., 26%,
L.B BROMINE
COMPOUNDS LTD., 50%.
TAMI IMI INSTITUTE
FOR RESEARCH &DEVELOPMENT LTD.,
DEAD SEA PRICLASE
FUSED PROD
ICL-IP AMERICA
INC., USA, owns HY YIELD BROMINE, 80%, USA.
ICL-IP JAPAN LTD.,
Japan,
LANDCAM LIMITED,
South Africa,
BROMINE &
CHEMICALS LIMITED, UK,
EUROCLEARON B.V.,
the Netherlands, owns CLEARON CORP., USA,
ICL-IP EUROPE
B.V., the Netherlands, holds several subsidiaries, including BROMOCHEMIE
HOLDINGS B.V., ICL IP TERNEUZEN B.V., SINOBROM (75%, China), LIANYONGANG DEAD
SEA BROMINE COMPOUNDS LTD (60%, China), etc.
ROTEM AMFERT NEGEV
B.V., Holland.
Other companies
part of the ICL Group, among many others:
ICL Fertilizers
Division:
ICL FERTILIZERS
LP,
ROTEM AMFERT NEGEV
LTD., producers, exporters and marketers of a varitey
of products based on phosphate rock mined in the Negev Desert, including
phosphate fertilizers, phosphoric acid and specialty fertilizers.
FERTILIZERS AND
CHEMICALS LTD., manufacturers, importers and marketers of fertilizers and
chemicals, mainly for the agriculture sector, nitrogen and phosphorus
fertilizers, industrial chemicals, feed additives, etc.
EUROCHIL HOLDING
B.V., Germany
AMSTERDAM
FERTILIZERS DEUTSCHLAND OHG (AMFERT GERMANY)
AMSTERDAM
FERTILIZERS B.V., the Netherlands
ROTEM HOLDING
GmbH, Germany
ZUARI ROTEM
SPECIALTY FERTILIZERS, 50%, India
P.M. CHEMICALS
SRL, Italy
ICL ASIA LTD.
ROTEM BKG LLC, USA
ROTEM DU BRAZIL
LTD, ICL BRAZIL LTDA, both of Brazil
ICL FERTILIZERS
(INDIA) PRIVATE LIMITED, India
DEAD SEA WORKS
LTD., producers, manufacturers, exporters and marketers of potash and other
chemicals from the Dead Sea. Controls, among others, ICL IBERIA SCS and IBER
POTASH S.A. of Spain, CLEAVLAND POTASH LIMITED (CPL) of the U.K.
ICL Performance
Products:
ICL PERFORMANCE
PROD
B.K. GIULINI GmbH,
a subsidiary in Germany
BKG PURIPHOS B.V.
PEKAFERT B.V.,
holds EUROCIL LUXEMBOURG
ASTARIS INC. of
the U.S.A. and Brazil
ICL NORTH AMERICA
INC, USA.
ICL Metallurgy, headed by DEAD
SEA MAGNESIUM LTD., producers, manufacturers, exporters and marketers of
magnesium and related products, producing magnesium from the Dead Sea.
Others:
MIFALEI TOVALA
LTD., land transportation, bulk
transportation
I.D.E.
TECHNOLOGIES LTD., 50%, desalination facilities and water treatment,
ICL FINANCE B.V.,
The Netherlands, ICL FINANCE INC., The USA, ICL FINANCE & ISSUING LTD., ICL FINE CHEMICALS LTD.,
TWINCAP FOERSAEKRINGS AB (Sweden), and many others, including companies in the
ICL Group and ISRAEL CORP. concern.
BANKERS
·
Bank Leumi
Le'Israel Ltd., Beer Sheva, Branch (No. 921), Beer Sheva.
· Bank Hapoalim Ltd., Beer Sheva Branch (No. 631), Beer Sheva.
CHARACTER AND
REPUTATION
In November
There are several
other claims, mainly due to environmental issues, none seem to be significant
at this stage. DSBG and ICL have been investing tens of NIS millions in recent
years in environmental protection ends.
Apart from that,
nothing unfavorable learned.
DSBG meets ISO 9000, ISO 14000 quality
standards.
DSBG is considered
of the world’s leading company in the bromine market, with estimated production
of 35% of the total elementary bromine production in the world and lead in the
bromine-based flame retardant products market. Imports amount to US$ 100
million per annum. In addition, it is a world’s leading producer of specialty
phosphates based on purified phosphoric acid.
ICL is a multi-national concern, among the world's leading suppliers of
minerals and one of the largest industrial concerns in Israel. ICL is the world's
6th largest potash manufacturer (9.2% of market share in 2010) and the world's largest producer of PK fertilizers (compound of potash and
phosphate fertilizers).
ICL Group,
including subject and the ICL-IP Division,
were adversely affected by the global economic crisis that hit world markets,
including the sectors and industries subject is selling to, such as the
electronics, construction, automotive, oil drilling and water treatment. ICL took massive
cost saving steps to face the depression. The fall in raw materials prices
compensated for some of the decrease in profitability. Yet, since the 4th
quarter of 2009 there was a trend turn in demands, thanks to some recovery in
worlds markets, as seen in the improvement in financial results above.
The ISRAEL CORP., part of the OFER Group, is Israel’s largest holding company, operating
worldwide mainly in the fields of chemicals, energy, high tech &
electronics. OFER Group is one the largest and most influential groups in the
Israeli market, with businesses worldwide, mainly shipping and real estate.
POTASH CORP. (PCS) of Canada, which holds some 14% in ICL, is the world's largest fertilizers
producer.
In 1995 ICL
acquired CLEARON CORP. of the USA, for US$ 50 million.
DSBG signed long term
cooperation agreement with the DOW CHEMICALS Group, including with subsidiary
DOW AGROSCIENCE (value of the agreements - of around US$ 100 million per
annum). Also signed a joint venture agreement with the Chinese leading chemical
company SHANDONG HAIHUA SHAREHOLDING COMPANY LTD., for a joint establishment of
a manufacturing and marketing plant in China for bromine compounds, with
investment of US$ 30 million (equally split).
DSBG also signed
in 2001 an agreement with one of the largest Japanese companies, D.K.
(manufacturers and marketers of chemical products), for the formation of a
joint venture, for manufacturing and marketing of delaying combustion chemical
products for the Far East market.
In
september 2005, ICL acquired ASTARTIS, producers of phsphate-based products of
the USA and Brazil, for a sum of US$ 255 million.
In the beginning
of 2007 ICL acquired also the assets and activities of Canadian FIRETROL, which
develops phosphoric based products for fire extinguishing (in forests, etc.).
In August 2007 ICL
acquired American SUPRESTA, manufacturers of phosphorus products for fire
safety, in consideration of US$ 352 million (by ICL own finance). SUPRESTA is
the leading company in its field in the world. ICL's products for fire safety
were so far based on bromine, and the purchase expands this line of products to
the new area.
In November 2007,
ICL Performance Products acquired BIOGEMA of France, producers of fire
extinguishing products, for several US$ million and in January 2008 acquired the
water treatment activities of the HENKEL, for US$ 89 million.
Also as part of
ICL strategy to expand its Industrial Products and Performance Products market
share, in December 2009 ICL announced the recent acquisition of 6 European
companies in the fields of water purification (MEDENTECH of Ireland) and
hygiene (including PRIMALAB of France, HYPROCLEAN of Germany and EKULINE’s
cleaning products Div.), for estimated total sum of US$ 40 million.
ICL Group's plants
are expected to benefit from the shift of the Group's use in natural gas as
energy source (replacing the ISRAEL ELECTRICITY CORP. conventional electricity
power) apart of the end of 2008, after the infrastructure for the gas
conveyance will be completed. ICL expects to save US$ 100 million per year due
to the shift of energy source. In March 2008 subject signed an agreement with
TETHYS SEA, to supply natural gas to subject in value of US$ 260-330 million.
In May 2010 it was
reported that DSBG is benefiting from the decrease in bromine salt levels in
China's bromine production sites which led to lower Chinese production and
higher bromine prices. Hence, since the beginning of 2010 subject moved to
produce to 85%-90% of its production capacity, compared with some 46% in 2009.
In June 2010 it was reported that ICL signed
transportation contracts with ISRAEL RAILWAYS for cargo from the Dead Sea and
Negev Desert until
On 21.12.2010 the
Israeli Parliament voted to cancel ICL special tax benefits (hundreds NIS
millions), as part of a revision concerning royalties from State resources (ICL
has been enjoying both from low royalties rate and tax benefits). The State
claims that ICL also paid less than it had to (including from bromine
extraction) and will have to compensate the State. This will have certain
negative implications on ICL Group’s future results.
In February 2011
ICL completed the acquisition of SCOTTS GLOBAL PROFESSIONAL BUSINESS, a division
in SCOTTS
In its quest to expand in the specialized
fertilizers field, in April 2011 ICL announced on the acquisition of Spain's
largest actor in this area, FUENTS MENDEA S.A. for €95 million.
In June 2011 ICL Performance Products signed
a contract to acquiring Mexican company COSMOCEL QUIMICA, manufacturers of food
additives and specialty chemicals. Estimated purchase sum is US$ 30 – US$ 40
million.
In December 2011 it
was reported that ICL bought CHEMTURA’s 50% share in their TETRABROM
TECHNOLOGIES bromine compounds joint venture, the world's largest flame
retardants manufacturer, becoming the sole owner of the operation.
Subject developed a bromine compound, which eliminates
the mercury pollution of coal burning of power plants. Following the expecting
of a significant demand increase (due to strict environmental laws), in
November 2011 it was reported that subject is intending to invest some US$ 100
million in the expansion of Ramat Hovav plant.
SUMMARY
Good for trade engagements.
Good for all
credits.
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.50.33 |
|
UK Pound |
1 |
Rs.77.97 |
|
Euro |
1 |
Rs.65.07 |
RATING EXPLANATIONS
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
>86 |
Aaa |
Possesses an extremely sound financial base with the strongest
capability for timely payment of interest and principal sums |
Unlimited |
|
71-85 |
Aa |
Possesses adequate working capital. No caution needed for credit
transaction. It has above average (strong) capability for payment of interest
and principal sums |
Large |
|
56-70 |
A |
Financial & operational base are regarded healthy. General unfavourable
factors will not cause fatal effect. Satisfactory capability for payment of
interest and principal sums |
Fairly Large |
|
41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
|
26-40 |
B |
Capability to overcome financial difficulties seems comparatively
below average. |
Small |
|
11-25 |
Ca |
Adverse factors are apparent. Repayment of interest and principal sums
in default or expected to be in default upon maturity |
Limited with full
security |
|
<10 |
C |
Absolute credit risk exists. Caution needed to be exercised |
Credit not
recommended |
|
---- |
NB |
New Business |
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This score serves as a reference to assess SC’s credit risk and
to set the amount of credit to be extended. It is calculated from a composite
of weighted scores obtained from each of the major sections of this report. The
assessed factors and their relative weights (as indicated through %) are as
follows:
Financial
condition (40%) Ownership
background (20%) Payment
record (10%)
Credit history
(10%) Market trend
(10%) Operational
size (10%)
This report is issued at your request without any
risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL)
or its officials.