Negev Ceramics Returns to Tel Aviv Stock Exchange with 87 Million Shekel Bond Issue After 14 Years
Negev Ceramics has re-entered the Tel Aviv Stock Exchange after 14 years, this time through a bond issuance rather than equity trading. The company completed a tender for institutional investors, raising 87 million shekels. Negev is jointly owned by Viola Credit fund and a group led by businessman Yariv Lerner, each holding 50% of the shares. The company specializes in importing, marketing, distributing, and selling home design and construction finishing products, including tiles, sanitary ware, shower cabins, and bathroom cabinets.
The bonds were offered unsecured with a maximum interest rate of 7.5%. Negev initially aimed to raise 109 million shekels, expecting net proceeds of 105 million shekels after fees and discounts. However, due to market uncertainty, reliance on the slowing construction sector, and lack of collateral, orders at or below 7.5% interest totaled 87.1 million shekels, with final proceeds of 87.3 million shekels. The bond series has a duration of 3.8 years and will be repaid in six installments from the end of 2027 through 2032.
According to the prospectus, Negev plans to use the funds primarily to repay 70 million shekels of debt out of 100 million shekels due within the next year, mostly short-term bank loans. Negev Ceramics was delisted in 2012 after its controlling shareholder, Africa Israel Industries, bought out remaining public shares amid financial difficulties, including a debt load of 700 million shekels and heavy investments in a new factory in Yeruham. A 2017 debt restructuring led to Viola and Lerner acquiring control.
Negev reported a 3% revenue increase to 118 million shekels in Q1 2026 compared to Q1 2025, with operating profit rising to 6.8 million shekels and net profit turning positive at 4.1 million shekels after reducing financing costs. In 2025, revenues grew 13% to 460 million shekels, and net profit reached 6.1 million shekels, reversing a prior loss. The company noted that the recent profit improvement was partly due to currency depreciation effects. However, exposure to the residential construction market slowdown could impact future results.
Negev stated that the bond issuance and public status are part of its strategic plan rather than an urgent capital need. The company chose to issue bonds at market-appropriate rates and declined higher-rate offers. Proceeds will also support acquisitions in construction finishing and expansion of domestic operations.
