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Report Date : |
14.05.2012 |
IDENTIFICATION DETAILS
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Name : |
BROMINE COMPOUNDS LTD. |
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Registered Office : |
P.O. Box 180, Beer Sheva (84101) Makleff House |
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Country : |
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Financials (as on) : |
30.09.2011 |
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Date of Incorporation : |
11.01.1961 |
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Legal Form : |
Private Limited Company |
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Line of Business : |
Manufacturers, exporters
and marketers of bromine
compounds and other industrial chemicals |
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No. of Employees : |
11,965 |
RATING & COMMENTS
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MIRA’s Rating : |
Ba |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
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Status : |
Satisfactory |
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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 – March 31st, 2012
|
Country Name |
Previous Rating (31.12.2011) |
Current Rating (31.03.2012) |
|
|
A2 |
A2 |
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Risk Category |
ECGC
Classification |
|
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 |
Correct
Name:
BROMINE COMPOUNDS LTD.
Telephone 972
8 629 72 22
Fax 972
8 628 04 44; 629 78 48
P.O. Box 180, Beer Sheva (84101)
Makleff House
12 Kroitzer Street
BEER SHEVA 84894 ISRAEL
A private limited
company, incorporated as per file No. 51-027339-4 on the 11.01.1961. Since 1962
parent company (DSBG) has the State sole concession for extracting bromine and
its compounds (current license is till 2030).
Authorized share
capital NIS 289,999,999.80, divided into -
1,611,111,110
ordinary shares (1,595,659,395 issued) of NIS 0.18 each,
1 special share of NIS 0.0001
(issued),
of which shares
amounting to NIS 287,218,691.1001 were issued.
Company is fully owned
by DEAD SEA BROMINE COMPANY LTD. (DSBG),
a fully owned subsidiary of 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.
Up till November
2000 parent DSBG shares were traded on the Tel Aviv Stock Exchange. In November
2000 subject’s “grandparent” ICL reached full control over DSBG after it
acquired 10.8% of its shares from the public in consideration of NIS 270
million.
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).
1. Nir Gilad, Chairman of ICL,
2. Akiva Moses, Chairman of
subject and CEO of ICL,
3.
Yossi Rosen,
4.
Asher Greenbaum,
5.
Eli Amit,
6.
Amnon Sadeh,
7.
Yakov Dior,
8.
Avisar Paz,
9.
Yosi Shachar,
10.
Yossi Lastigzon,
11.
Avi Dueitchman,
12.
13.
Shlomo Maoz,
14.
Amir Makov,
15.
Yair Orgler,
16.
Victor Medina,
17.
Avraham (Beiga) Sochat (former Minister of
Finance).
Nissim Hadar (also
of DSBG).
Subject is part of ICL Industrial Products (ICL-IP), headed by the DEAD SEA BROMINE GROUP (DSBG). ICL-IP sales comprised some 23% of ICL total 2010
(some 22% in 2009 and 18% in 2008).
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. 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.
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 Elementary Bromine (128,000 tons produced in 2009).
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.
Subject and DSBG
are operating from head offices in Makleff House, 12, Kroitzer Street,
Industrial Zone, Beer Sheva, a large plants compound in Ramat Hovav and a plant
in Sodom (in the Dead Sea shores).
ICL-IP
also operate from main plants in the USA, China 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 11,965
employees in the ICL Group (of which some 5,200 employees in Israel), of which
over 2,620 employees in ICL IP Div. (which subject is part of).
Financial data is
included in the consolidated statements of parent company, ISRAEL CHEMICALS
LTD., which shows:
US$ (thousands)
ASSETS 31.12.2010 30.09.2011
Current assets:
Cash and cash equivalents 400,914 384,334
Investments, deposits and
short term loans 493,201 255,901
Customers 949,692 1,350,471
Other receivables 172,178 221,178
Stock 1,114,134 1,268,973
3,130,119 3,480,857
Non-current assets:
Investments and other
non-current assets 523,652 523,904
Fixed assets 2,190,594 2,486,528
Intangible assets 543,779 778,414
3,258,025 3,788,846
6,388,144 7,269,703
======== ========
LIABILITIES
Current Liabilities 1,465,811 2,490,535
Non-current liabilities 2,281,103 1,679,313
Equity 2,641,230 3,099,855
6,388,144 7,269,703
======== ========
ICL’s current
market value US$ 13,134 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.
Subject is an
“Approved Enterprise” and as such enjoys tax benefits and State incentives,
including from The Chief Scientist Office. DSBG
received an approval from the Israel Investment Centre (IIC) for a US$ 50
millions expansion plan for the Bromine plant in Sodom. In 2000, IIC
approved investment plans for subject (jointly with sister DEAD SEA BROMINE CO.)
for the sum of US$ 140 million.
There is 1 charge
for an unlimited amount registered on the company’s assets, in favor of a
foreign company CRYSTAL PURCHASING LTD.
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 compared to the parallel
period of 2010), making an operating profit
of
US$ 234.2 million.
DSBG
ended 2008 with a consolidated net profit of US$ 30,852,000.
DSBG
ended 2009 with a consolidated net profit of US$ 67,286,000.
DSBG
ended 2010 with a consolidated net profit of US$ 73,699,000.
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's
subsidiaries:
BROMINE COMPOUNDS
MARKETING (2002) LTD., 100%,
TETRABROM
TECHNOLOGIES LTD., 50%,
CHEMADA FINE
CHEMICALS LTD., 26%,
L.B BROMINE
COMPOUNDS LTD., 50%.
Also part of ICL Industrial Products and DSBG, headed by parent company DEAD
SEA BROMINE COMPANY LTD. (among others):
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.
Bank
Leumi Le’Israel Ltd., Beer Sheva Branch (No. 921), Beer Sheva.
Bank
Hapoalim Ltd., Beer Sheva Branch (No. 631), Beer Sheva.
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 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 (in
which subject is its main industrial company),
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.
Subject meets ISO 9000, ISO 14000 quality
standards.
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 ICL 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.
The local Chemical
industry is considered one of the strongest in the market, with impressive
growth trend in recent years. The industry employs 30,000 employees.
Total turnover of
the local Chemical Industry in 2008 amounted to US$ 24 billion, comprising 30%
of Israel’s total industrial turnover.
The Chemical
sector recovered in 2010 after it shrunk in 2009 due to the global economic
crisis, where export of Industrial Chemicals rose by 34.3% from 2009 to US$
13.95 billion, reflecting the recovery in global markets.
Good for trade engagements.
Maximum unsecured
credit recommended up to several US$ millions.
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.53.64 |
|
UK Pound |
1 |
Rs.86.42 |
|
Euro |
1 |
Rs.69.29 |
INFORMATION DETAILS
|
Report Prepared
by : |
MNL |
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 |
---- |
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.