Yigal Dery Faces Potential Ouster from Tel Aviv Stock Exchange's Top Index
Translated & summarized from Ice by baba
Israeli construction magnate Yigal Dery's company is at risk of being removed from the Tel Aviv 35 Index due to its current market capitalization. The company's potential exclusion could impact its reputation and future financing, despite Dery recently receiving a lifetime achievement award.
The story in 6 lines · by baba
- Yigal Dery's company may be removed from the Tel Aviv 35 Index.
- Index inclusion depends on market capitalization during a key ten-day period.
- Dery's company is currently ranked below the required position for the index.
- Exclusion could harm the company's reputation and access to capital.
- Dery recently received a lifetime achievement award for his work.
- He aims to develop areas outside major Israeli urban centers.
Yigal Dery, the owner of Y.H. Dery, a major Israeli construction company, is at risk of being removed from the Tel Aviv 35 Index, the stock exchange's benchmark index. The potential exclusion is tied to the upcoming index rebalancing in early November, which is determined by the ten trading days leading up to October 15th. Dery's position in the index is crucial, especially after raising approximately 1.4 billion shekels from institutional investors like Phoenix, Meitav Dash, Harel, and Menora earlier this year. The index inclusion is based on market capitalization, calculated by the average share price during the ten determining days multiplied by the number of shares. Currently, Dery's company is ranked 47th, below the 39th position required for inclusion, with a market value of about 1.5 billion shekels less than the threshold.
Other companies, including Shufersal and Canon, are also vying for a spot in the index. Dery himself might take actions, such as buying back shares, to boost his company's market value and secure his position. Historically, Dery has demonstrated the ability to implement measures to remain in the index. Exclusion from the Tel Aviv 35 Index carries significant reputational damage and can lead institutional investors to sell their holdings, impacting the company's ability to raise future debt at favorable rates, given its reliance on institutional trust.
In related news, Dery, recognized as one of Israel's veteran and most respected contractors, recently received a lifetime achievement award. He expressed his ambition to "eliminate the concept of periphery," aiming to develop areas outside major urban centers. Dery, originally from southern Israel, began his career as a farmer before entering the construction industry. In 1989, he founded Y.H. Dery in Netivot, transforming it from a family business in the south into one of Israel's largest development and construction firms, while maintaining its connection to the Negev region. The company went public on the Tel Aviv Stock Exchange in 2004 and joined the Tel Aviv 35 Index in 2024.
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