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MIRA INFORM REPORT
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Report No. : |
500553 |
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Report Date : |
03.04.2018 |
IDENTIFICATION DETAILS
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Name : |
WAVELENGTH ENTERPRISES LTD. |
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Registered Office : |
P.O. Box 2231 (5112102), 31 Lehi Street, Industrial Zone, Bnei Brak 5120052 |
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Country : |
Israel |
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Date of Incorporation : |
21.08.1986 |
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Legal Form : |
Private Limited Company |
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Line of Business : |
Developers, manufacturers,
exporters and marketers of differentiated Active Pharmaceutical Ingredients
(APIs) and Finished Dosage Forms (FDFs) for the branded and generic
pharmaceutical industries. |
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No. of Employees : |
300 [2016] |
RATING & COMMENTS
(Mira Inform has adopted New Rating mechanism w.e.f. 23rd
January 2017)
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MIRA’s Rating : |
A |
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Credit Rating |
Explanation |
Rating Comments |
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A |
Acceptable Risk |
Business dealings permissible with
moderate risk of default |
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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
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Country Name |
Previous Rating (30.09.2017) |
Current Rating (31.12.2017) |
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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 Risk |
A2 |
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Moderately Low Risk |
B1 |
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Moderate Risk |
B2 |
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Moderately High Risk |
C1 |
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High Risk |
C2 |
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Very High Risk |
D |
ISRAEL - ECONOMIC OVERVIEW
Israel has a technologically advanced free market economy. Cut diamonds,
high-technology equipment, and pharmaceuticals are among its leading exports.
Its major imports include crude oil, grains, raw materials, and military
equipment. Israel usually posts sizable trade deficits, which are offset 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 weathered the 2011 Arab Spring because strong trade ties outside the
Middle East insulated the economy from spillover effects.
Slowing domestic and international demand and decreased investment
resulting from Israel’s uncertain security situation reduced GDP growth to an
average of roughly 2.8% per year during the period 2014-17. 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 in the last decade. Political and regulatory
issues have delayed the development of the massive Leviathan field, but production
from Tamar provided a 0.8% boost to Israel's GDP in 2013 and a 0.3% boost in
2014. One of the most carbon intense OECD countries, Israel generates about 57%
of its power from coal and only 2.6% from renewable sources.
Income inequality and high housing and commodity prices continue to be a
concern for many Israelis. 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. Government officials have called for reforms to
boost the housing supply and to increase competition in the banking sector to
address these public grievances. Despite calls for reforms, the restricted
housing supply continues to impact the well-being of younger Israelis seeking
to purchase homes. Tariffs and non-tariff barriers, coupled with guaranteed
prices and customs tariffs for farmers kept food prices high in 2016. Private
consumption is expected to drive growth through 2018 with consumers benefitting
from low inflation and a strong currency.
In the long term, Israel faces structural issues, including low labor
participation rates for its fastest growing social segments - the ultraorthodox
and Arab-Israeli communities. Also, Israel's progressive, globally competitive,
knowledge-based technology sector employs only about 8% of the workforce, with
the rest mostly employed in manufacturing and services - sectors which face
downward wage pressures from global competition. Expenditures on educational
institutions remain low compared to most other OECD countries with similar GDP
per capita.
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Source
: CIA |
Company name & address
WAVELENGTH
ENTERPRISES LTD.
Telephone 972
3 577 36 09; 577 38 80
Fax 972 3 577 38 23
P.O. Box 3593, BEER SHEVA (8413502)
P.O. Box 2231
(5112102)
31 Lehi Street
Industrial Zone
Bnei Brak 5120052 Israel
HISTORY
& LEGAL FORMATION
A private limited
company, incorporated as per file No. 51-113965-1 on the 21.08.1986.
Originally registered
under the name CHEMAGIS LTD., which changed to PERRIGO API LTD. on the
08.08.2013.
Following the sale
of PERRIGO’s API activities to SK CAPITAL in November 2017, name changed to
present one on the 10.12.2017.
SHARE
CAPITAL
Authorized share
capital NIS 55,000,000.00, divided into -
55,000,000
ordinary shares of NIS 1.00 each, of which 42,961,680 shares amounting to NIS
42,961,680.00 were issued.
SHAREHOLDERS
Subject is fully owned by WAVELENGTH
PHARMACEUTICALS LTD., fully owned by WAVELENGTH INTERMEDIATE SARL, fully owned
(possibly in chaining) by SK CAPITAL PARTNERS, a US private investment firm.
In November 2017,
PERRIGO CO. completed the sale of subject to SK CAPITAL for US$ 110 million.
DIRECTORS
1. Iftach Seri, General Manager,
2. Stephen D’Incelli, of SK, of
the USA,
3. Aaaron Charles Davenport, of
the USA.
BUSINESS
Developers,
manufacturers, exporters and marketers of differentiated Active Pharmaceutical
Ingredients (APIs) and Finished Dosage Forms (FDFs) for the branded and generic
pharmaceutical industries.
Sales are to
generic and branded pharmaceutical companies.
Among local
suppliers: LUXEMBURG INDUSTRIES, MARLOV, LGM PHARMA, TAGAD CHEMICALS, SMADAR
TECH., HOLLAND-MORAN, SIGMA – ALDRICH, TECHNO BEARING TOOLS B.S., BIO PHARMAX
GROUP, etc.
Operating from
main offices, on an area of 1,200 sq. meters, in 31 Lehi Street, Industrial
Zone, Bnei Brak (PERRIGO Group headquarters is located in 29 Lehi Street, on an
area of 10,000 sq. meters), and from a plant, on an area of 55,000 sq. meters
(owned by the Group), in Neot Hovav Eco-industrial Park, Ramat Hovav (8551600),
south of Beer Sheva.
Also operating from facilities in the USA.
Website: www.wavelengthpharma.com
Had some 300 employees
in subject as of end of 2016. Current
number of employees in subject an in WAVELENGTH Group not forthcoming.
MEANS
Subject was valued
at US$ 110 million for the acquisition by SK in November 2017.
According to
PERRIGO CO.'s financial statements, total assets attributed to Other Segment
(formerly API Segment), which PERRIGO API was a major part of, as of
31.12.2016: US$ 304.1 million (US$ 213.1 million as of 31.12.2015).
PERRIGO API used to be an “Approved
Enterprise” and as such enjoying tax benefits and State incentives (we do not
know the current status following the change in ownership).
There is 1 charge
for an unlimited amount registered on the company's assets (all assets), in
favor of a UK trust company (charge placed December 2017).
REVENUES
Sales by PERRIGO’s
'Other' Segment (which comprises mainly of PERRIGO Group's API activities,
including subject – until 2014 was called API Segment):
2014 sales were
US$ 119.3 million.
2015 sales were
US$ 98.0 million.
2016 sales were
US$ 78.5 million.
According to
PERRIGO's officials (in 2016), subject is profitable.
Later sales data,
including under the new shareholders, not forthcoming.
OTHER
COMPANIES
According to our,
subject had a subsidiary in the USA: PERRIGO API USA, INC., USA.
Since we could not
speak to subject’s officials, we were unable to verify current status of
subsidiary (we assume name changed).
WAVELENGTH
PHARMACEUTICALS LTD., parent company, a holding company.
SK CAPITAL PARTNERS, an American New York
based private investment firm, focusing on investments in materials, chemicals
and pharmaceuticals sectors. Managing some US$ 5 billion.
BANKERS
According to our,
subject works with (since we could not speak to subject’s officials, we are
unable to verify the u/m bank details):
Bank Leumi
Le’Israel Ltd., Principal Branch Tel Aviv (No. 800), Tel Aviv.
Mizrahi Tefahot Bank Ltd., Tel Aviv Main Business Center Branch (No.
461), Tel Aviv.
Bank Hapoalim
Ltd., Business Center Branch (No. 600), Tel Aviv.
HSBC Bank Plc,
Main Branch (No. 101), Tel Aviv.
CHARACTER
AND REPUTATION
Nothing
unfavorable learned.
Despite our
efforts, we were unable to speak with subject's officials, as they were always
unavailable. We called subject’s offices and received no answer.
It should be noted
that currently it is a holiday period in Israel (Passover), and many company go
on a consolidated vacation.
Subject’s former
parent company, PERRIGO, ended 2016 with a net loss of US$ 4012.8 million, and
as part of its streamlining process, in November 2017 it completed the sale of
subject to SK CAPITAL.
Subject is veteran
and well-known in its field. Its products comply with the requirements and
standards of leading health authorities including the FDA.
There are some 13
generic pharmaceutics production companies in Israel and the industry employs
9,000 employees.
Over 90% of sales
by the local Pharmaceutical Industry are for export.
According to the
Central Bureau of Statistics, sales for exports of pharmaceuticals (mainly
human uses, also veterinary use) in 2016 reached US$ 7,538 million, compared to
export of US$ 6,905.8 million in 2016, US$ 6,809.4 million in 2015, US$ 6,485.3
million in 2014, and US$ 6,317.7 million in 2013.
Import of
pharmaceutical products to Israel in 2016 reached US$ 2,006.5 million, compared
to US$ 1,916 million in 2015 and US$ 1,899 million in 2014. Import in the first
11 months of 2017 reached US$ 1,966.6 million, 7% higher than in the parallel
period in 2016.
SUMMARY
Notwithstanding
the lack of updated data from subject's officials, being part of SK CAPITAL,
considered good for trade engagements.
FOREIGN EXCHANGE RATES
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Currency |
Unit
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Indian Rupees |
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US Dollar |
1 |
INR 65.04 |
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1 |
INR 92.28 |
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Euro |
1 |
INR 80.62 |
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ILS |
1 |
INR 18.43 |
Note :
Above are approximate rates obtained from sources believed to be correct
INFORMATION DETAILS
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Analysis Done by
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NIY |
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Report Prepared
by : |
TPT |
RATING EXPLANATIONS
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Credit Rating |
Explanation |
Rating Comments |
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A++ |
Minimum Risk |
Business dealings permissible with minimum
risk of default |
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A+ |
Low Risk |
Business dealings permissible with low
risk of default |
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A |
Acceptable Risk |
Business dealings permissible with
moderate risk of default |
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B |
Medium Risk |
Business dealings permissible on a regular
monitoring basis |
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C |
Medium High Risk |
Business dealings permissible preferably
on secured basis |
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D |
High Risk |
Business dealing not recommended or on
secured terms only |
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NB |
New Business |
No recommendation can be done due to
business in infancy stage |
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NT |
No Trace |
No recommendation can be done as the
business is not traceable |
NB is stated where there is insufficient information to facilitate rating. However, it is not to be considered as unfavourable.
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 are as follows:
·
Financial
condition covering various ratios
·
Company
background and operations size
·
Promoters
/ Management background
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Payment
record
·
Litigation
against the subject
·
Industry
scenario / competitor analysis
·
Supplier
/ Customer / Banker review (wherever available)
This report is issued at
your request without any risk and responsibility on the part of MIRA INFORM
PRIVATE LIMITED (MIPL) or its officials.