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Report No. : |
337062 |
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Report Date : |
20.08.2015 |
IDENTIFICATION DETAILS
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Name : |
ASSIA CHEMICAL INDUSTRIES LTD. |
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Formerly Known As : |
CHEMICAL EXPORT INDUSTRIES OF ASSA LTD., |
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Registered Office : |
P.O. Box 3190,
Petach Tikva, 2 Denmark Street, Kiryat Arie Industrial Zone, Petach Tikva
4959279 |
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Country : |
Israel |
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Financials (as on) : |
30.06.2015 |
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Date of Incorporation : |
14.08.1957 |
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Com. Reg. No.: |
51-016828-9 |
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Legal Form : |
Private Limited Company |
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Line of Business : |
Subject is developers, manufacturers, exporters and marketers of
Active Pharmaceutical Ingredients (API) and fine chemicals and raw materials |
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No. of Employee : |
1,000 43,000 (Group) |
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 : |
Regular |
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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 31, 2015
|
Country Name |
Previous Rating (31.12.2014) |
Current Rating (31.03.2015) |
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Israel |
B1 |
B1 |
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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 |
ISRAEL - ECONOMIC OVERVIEW
Israel has a technologically advanced market economy. Cut diamonds, high-technology equipment, and pharmaceuticals are among the leading exports. Its major imports include crude oil, grains, raw materials, and military equipment. Israel usually posts sizable trade deficits, which are covered by tourism and other service exports, as well as significant foreign investment inflows. Between 2004 and 2013, growth averaged nearly 5% per year, led by exports. The global financial crisis of 2008-09 spurred a brief recession in Israel, but the country entered the crisis with solid fundamentals, following years of prudent fiscal policy and a resilient banking sector. Israel's economy also has weathered the Arab Spring because strong trade ties outside the Middle East have insulated the economy from spillover effects. Slowing demand domestically and internationally and reduced investment due to uncertainties caused by the Gaza conflict in summer 2014 have reduced GDP growth to about 2% during 2014. Natural gas fields discovered off Israel's coast since 2009 have brightened Israel's energy security outlook. The Tamar and Leviathan fields were some of the world's largest offshore natural gas finds this past decade. The massive Leviathan field is expected to come online no sooner than 2017, but production from Tamar provided a one percentage point boost to Israel's GDP in 2013 and a 0.5% boost in 2014. In mid-2011, public protests arose around income inequality and rising housing and commodity prices. Israel's income inequality and poverty rates are among the highest of OECD countries and there is a broad perception among the public that a small number of "tycoons" have a cartel-like grip over the major parts of the economy. The government formed committees and has started splitting up the oligopolies to address some of the grievances but has maintained that it will not engage in deficit spending to satisfy populist demands. Over the long term, Israel faces structural issues, including low labor participation rates for its fastest growing social segments - the ultra-orthodox and Arab-Israeli communities. Also, Israel's progressive, globally competitive, knowledge-based technology sector employs only 9% of the workforce, with the rest employed in manufacturing and services - sectors which face downward wage pressures from global competition.
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Source
: CIA |
ASSIA CHEMICAL
INDUSTRIES LTD.
(Also trading as: TEVA ASSIA)
Telephone 972
3 925 55 55; 926 72 67
Fax 972
3 924 60 53
P.O. Box 3190,
Petach Tikva
2 Denmark Street
Kiryat Arie
Industrial Zone
PETACH TIKVA 4959279, ISRAEL
Additional Address:
P.O. Box 2049
Emek Sara
BEER SHEVA 8412316, ISRAEL
A private limited company,
incorporated as per file No. 51-016828-9 on the 14.08.1957.
Originally
registered under the name CHEMICAL EXPORT INDUSTRIES OF ASSA LTD., which
changed to the present name on the 06.02.1977.
On 08.07.2002,
TEVA TECH LTD. (established 1983) was merged into subject.
Authorized share
capital NIS 550,000,000.00, divided into: -
250,000,000 ordinary A shares (190,307,393
shares issued),
300,000,000
ordinary shares (20,556,739 shares issued), all of
NIS 1.00 each, of which shares amounting to
NIS 210,864,132.00 were issued.
Subject is fully
owned by TEVA PHARMACEUTICAL INDUSTRIES LTD.
TEVA is a public
limited company, whose shares are traded on the Tel Aviv Stock Exchange, the New York
Stock Exchange (NYSE:TEVA), as well as on Seaq International in London and the
Frankfurt and Berlin Stock Exchange.
1. Dov Primovich,
2. Yosef Koren,
3. Ehud Amir.
Erez
Vigodman (also President and CEO of TEVA PHARMACEUTICAL).
Subject is part of
TEVA's Chemical Div. - TAPI- Teva's Active
Pharmaceutical Ingredients. Developers, manufacturers, exporters and marketers
of Active Pharmaceutical Ingredients (API) and fine chemicals and raw materials
for the pharmaceutical industry. Most sales are for exports.
Operating from
main premises (offices, plant, R&D facilities), on an area of 11,000 sq.
meters, owned by the TEVA Group, in 2 Denmark Street, Kiryat Arie Industrial
Zone, Petach Tikva and from facilities (plant, R&D and offices), on an area
of 110,000 sq. meters, in Teva Tech Site, Ramat Hovav.
TEVA Israel also operates from several other facilities in
Israel, including from Group's headquarters in 5 Basel Street, Kiryat Arie
Industrial Zone, Petach Tikva (the address you provided), including Labs
and Chain Supply Div. in 16 Basel Street, further API facilities in Netanya,
and from logistics center in Hevel
Modi'in Industrial Park (near Shoham), on an owned area of 77,000 sq.
meters. Also operate from facilities abroad (TEVA has a total of 20 API
production facilities).
Having over 1,000
employees.
Having some 43,000
employees serving TEVA Group, of which around 7,000 employees in Israel (had
44,945 employees in end of 2013) (see below CHARACTER on lay-off scheme).
TEVA current
market value US$ 66.58 billion.
Subject and other
companies in the TEVA Group are “Approved Enterprises” and as such enjoy tax
benefits and State incentives.
There
In March 2011 TEVA raised US$ 750 million offering bonds on the NASDAQ.
In July 2011 it
was reported that TEVA received a US$ 1 billion credit line from Japanese banks
for the acquisition of TAIYO.
In April 2012 TEVA raised US$ 2.9 billion via bond issuing and bank
loans and in December 2012 raised US$ 2 billion in bonds issuing.
In July 2013 it was reported that TEVA received a total of some NIS 12
billion tax incentives between 2006-2011.
Financial data is
included in the consolidated B/S of parent company TEVA PHARMACEUTICALS
INDUSTRIES LTD., which shows:
US$
(millions)
30.06.2015 31.12.2014
ASSETS
Current assets
Cash and cash equivalents 1,068 2,226
Accounts receivable 5,568 5,408
Inventories 4,226 4,371
Other current assets 2,437 2,391
13,299 14,396
Property, plant & equipment (net) 6,427 6,535
Identifiable intangible assets (net) 8,215 5,512
Goodwill 19,257 18,408
Other assets 3,173 1,569
50,371 46,420
====== ======
LIABILITIES
Current liabilities 14,473 12,289
Long-term liabilities 12,813 10,776
Equity 23,085 23,355
50,371 46,420
====== ======
REVENUES
TEVA
PHARMACEUTICALS INDUSTRIES LTD.
Consolidated
Statement of Income
US$
(millions)
Year
ended 31.12
2012 2013 2014
Sales 20,317 18,312 20,272
(of which sales of API) 796 692 724
Gross profit 10,652 9,515 11,056
Operating income 2,205 3,109 3,951
Income before income
taxes 1,819 2,956 3,638
Net income 1,910 2,768 3,042
====== ====== ======
Consolidated revenues for the first half of 2015
were US$ 9,948 million (a slight decrease compared to 1stH 2014), making a
gross profit of US$ 5,738 million, an operating income of US$ 1,411 million,
and a net income of US$ 985 million.
In December 2014 TEVA published a
forecast for 2015 sales which are expected to be in range of US$19 - 19.4
billion, with operating profit of US$5.7 – 5.9 billion.
Parent company
TEVA PHARMACEUTICALS INDUSTRIES LTD., developers, manufacturers, marketers and
exporters of pharmaceuticals, chemicals, and veterinary products. TEVA and
subsidiaries develop generic and proprietary drugs in all major therapeutic
categories. Worldwide operations are conducted through a network of
subsidiaries primarily located in North America, Europe, Latin America and
Asia. Having direct operations in some 60 countries, including 40 finished
dosage pharmaceutical manufacturing sites in 25 countries, 20 pharmaceutical
R&D centers and 20 API manufacturing sites.
Principal operating subsidiaries in terms of aggregate total revenues
(all 100% stake unless otherwise stated):
TEVA CANADA
LIMITED (Canada)
TEVA SANTÉ SAS
(France)
RATIOPHARM GMBH
(Germany)
TEVA GMBH
(Germany)
TEVA PHARMACEUTICAL
WORKS PRIVATE LIMITED COMPANY (Hungary)
TEVA ITALIA S.R.L
(Italy)
TEVA SEIYAKU
(Japan)
TEVA LIMITED
LIABILITY COMPANY (Russia)
TEVA PHARMA S.L.
(Spain)
TEVA UK LIMITED
(UK)
TEVA
PHARMACEUTICALS USA, INC. (USA)
TEVA
PHARMACEUTICALS has many other subsidiaries abroad.
TEVA
PHARMACEUTICALS subsidiaries in Israel (100%):
SALOMON LEVIN & ELSTEIN LTD. (S.L.E), importers and
distributors of pharmaceuticals and allied goods.
TEVA
MEDICAL LTD., manufacturers, importers,
marketers of medical equipment, specializing in dialysis systems and solutions.
PLANTEX LTD., developers, manufacturers and marketers of raw materials
for generic medicine, part of API Division.
ABIC LTD.,
developers, manufacturers, exporters and marketers of pharmaceutical & fine
chemicals.
Bank Hapoalim
Ltd., Beilinson Branch (No. 552), Petach Tikva.
Bank Leumi
Le’Israel Ltd., Principal Branch Tel Aviv (No.800), Tel Aviv.
Israel Discount
Bank Ltd., Jerusalem Main Branch (No. 060), Jerusalem.
Mizrahi Tefahot Bank
Ltd., Main Business Branch (No 461), Tel Aviv.
Nothing
unfavorable learned (there are several legal matters at TEVA corporate level
which may be also related to subject, but does not appears significant).
In the business aspect,
TEVA has been facing the challenge in respect to the approaching expire of
patent of its flagship drug Copaxone (the first
brand-name drug), for multiple sclerosis,
with US$ 4.2 billion sales in 2014, some 20% of
sales and main profit source in recent years. In June 2012 the Manhattan
Federal Court ruled (in favor of TEVA)
that its patent on Copaxone is valid until May 2014 (TEVA appealed to the Supreme Court). Yet in July 2013 the New York
District Court ruled that MYLAN LABORATORIES did not breach subject's 4 patens
of Copaxone (of the 9 existing patents). In the UK the court ruled that MYLAN
did breach the patents, and cannot market a generic version.
Facing drop in
sales and profits in that aspect (which caused share price to lose some 20%), TEVA announced on the embarking of a
unprecedented streamlining program, in which it will scale down oversized parts
of the company (including the massive lay-off scheme reported above), while
growing its generics business and core R&D programs – including high-value
complex generics, expanding its presence in emerging markets and broadening its
portfolio, especially in its specialty medicines and OTC businesses. In
parallel - exiting noncore R&D activities of lice treatment, Oncology and
Woman's health. TEVA expects to realize
US$2 billion in annual cost savings by the end of 2017.
TEVA reported in
October 2013 that it will reduce its global workforce by approximately 10%
(some 5,000 employees), and will complete the majority of the reduction by the
end of 2014. In this aspect, TEVA faces local public rage, given the large tax
relieves it receives from the government, seen by many as exaggerated in first
place, claiming relieves are related to benefits to the local market, including
hiring employees. As a result, TEVA has been freezing most of the local
dismissals.
In October 2013
subject's employees (some 1,100) called on unlimited strike due to a/m
re-organization plan. No later information published, we assume settlement
reached.
Despite our efforts, we were unable to speak with subject's officials,
as they were always unavailable. We left messages which so far remain
unanswered.
Subject is
considered one of TEVA’s principal operating subsidiaries in terms of
pharmaceuticals and API R&D, manufacturing and sales.
TEVA is Israel's
largest company. It is the world's pharmaceutical companies, and the No.1
generic company with global share in the generic field of 11%. The recent
acquisition of ALLERGAN GENERICS (see more below) puts TEVA among the top 10
pharmaceutical companies in the world. In the American market, share of new and
total prescriptions were 27.9% and 33.1%, respectively, according to December
2013 IMS data.
In the local
market TEVA has a 25% market share in the pharmaceutical field. TEVA is the
largest non-governmental supplier of healthcare products and services in
Israel.
Other significant
developments in TEVA Group history:
In 2003 TEVA
acquired SICOR, developers of API products and generic pharmaceuticals, for US$
3.4 billion (US$ 2 billion cash, US$ 1.4 billion shares).
In 2006 TEVA
finalized a major acquisition of its main competitor in generic drugs field
IVAX CORP., in value of US$ 8 billion (cash and shares).
In 2008 TEVA made
2 major acquisitions: BENTLEY PHARMACEUTICALS of Spain, manufacturers and
marketers of generic drugs, for US$ 360 million (in cash); and of BARR
PHARMACEUTICALS, INC. (established 1970), for US$ 7.46 billion (40% in shares,
rest in cash), as well as taking upon itself BARR's debt in volume of US$ 1.5
billion.
In August 2010, TEVA completed the acquisition of RATIOPHARM, Germany's
second largest generics producer for the sum of US$4.95 billion (€3.625
billion). Subject raised US$ 2.5 billion for the deal finance (3 bonds series),
becoming the no. one generic company in Europe, with leading market position in
10 countries.
In July 2011 TEVA
completed the acquisition of 57% of TAIYO (Japan's 3rd largest
pharmaceutical company) for US$ 460 million.
In October 2011
TEVA completed the acquisition of CEPHALON, a biotechnological company,
developers of nerve system drugs and more, for US$ 6.8 billion. CEPHALON,
established 1987, with 3,726 employees, was publicly traded on Nasdaq. Its
ethical drugs portfolio is complimentary to TEVA's.
In 2011 TEVA Group shifted to its new logistic
center in Hevel Modiin Industrial Park (near Shoham), in which it invested circa US$ 100 million.
In August 2011 it was reported that TEVA
intends on erecting a natural gas power plant (45mV) in its Teva Tech plant in
Ramat Hovav, designed to supply their plant's electricity consumption, with an
investment of some US$ 70 million.
In July 2012 it
was reported that subject will receive NIS 1 million from the Ministry of
Energy, to convert its plant to operate base on natural gas.
In March 2015 TEVA
signed an agreement for the acquisition of AUSPEX PHARMACEUTICALS for US$ 3.2
billion.
In April 2014 TEVA
made an offer to acquire its rival MYLAN (developers, manufacturers, marketers
of generic and specialty pharmaceuticals) for a value of US$ 43 billion.
MYLAN's board rejected the offer. TEVA began acquiring MYLAN shares (reaching a
4.61% of MYLAN, investing US$ 1.6 billion), however MYLAN board applied a
'poison pill' to prevent TEVA to take control over MYLAN, and in July 2015,
following u/m acquisition of ALLERGAN GENERICS, TEVA informed it is backing
down from the attempt to acquire MYLAN.
In June 2015 it
was reported that TEVA is transferring its headquarters to Ra'anana, and will
invest some NIS 500 million in the transfer, acquisition of land and
construction of new location.
In July 2015, in
the largest acquisition ever made by an Israeli company, subject signed a
definitive agreement with ALLERGAN PLC (NYSE: AGN) to acquire ALLERGAN GENERICS
in a transaction valued at US$ 40.5 billion. ALLERGAN will receive US$ 33.75
billion in cash and US$ 6.75 billion in TEVA's shares (hence ALLERGAN will hold
10% in TEVA). ALLERGAN (formerly known as ACTAVIS) is a global pharmaceutical
company focused on developing, manufacturing and commercializing branded
pharmaceuticals, generic and OTC medicines. It has a commercial presence across
100 countries. The acquisition is intended to make TEVA a leader in the INN and
branded generics industry with an overall product portfolio.
Annual sales
volume in the local pharmaceuticals market is estimated at NIS 4 billion,
divided into NIS 1.8 billion to the institutional sector (HMO's, hospitals,
etc.) and NIS 1.2 billion to the private sector (including pharma retail
chains).
In 2009 sales of
drugs for human consumption (including from import) reached US$ 1,409 million
(US$ 1,416 million in 2008), of which estimated over US$ 1,100 million were
from import.
Over 90% of sales
by the local Pharmaceutical Industry are for export.
Sales for exports
of pharmaceuticals in 2014 reached US$ 6,513.7 million, representing 3.1%
increase from 2013, a reverse in trend of the past couple of years (7.7%
decrease in 2013, down 6% in 2012) and back to growth trend (10% and 41.5%
increase in 2011 and 2010, respectively, from the previous years). Export of
pharmaceuticals rose by 5% in the 1st half of 2015 (compared to 1stH
2014).
There are some 13
generic pharmaceutics production companies in Israel and the industry employs
9,000 employees.
Good for trade
engagements and all credits.
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.65.25 |
|
|
1 |
Rs.102.25 |
|
Euro |
1 |
Rs.72.20 |
INFORMATION DETAILS
|
Analysis Done by
: |
RAS |
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Report Prepared
by : |
ASH |
RATING EXPLANATIONS
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
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>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.