August 31, 2014 / 7:18 AM / 4 years ago

Delek Group eyes London listing, moves to loss on one-off items

TEL AVIV (Reuters) - Israeli energy company Delek Group is considering issuing its shares for trading on the London Stock Exchange in addition to its Tel Aviv listing.

Delek’s board has instructed management to assess the possibility of such a listing in lieu of splitting up the company in two, Delek said on Sunday.

Separately, the company said it swung to a loss in the second quarter due to significant write-downs to the value of various holdings the company intends to sell as it refocuses its business on gas exploration

In December the company, controlled by Israeli billionaire Yitzhak Tshuva, said it was considering a split of its holdings that would involve its oil and gas activities being concentrated in a new company. Shares of the new energy company were to be registered for trade on a foreign bourse.

But since then Delek has reached binding agreements or is in advanced talks to sell off most of its non-energy holdings, such as its insurance subsidiaries.

“We are very pleased that our strategy to move our group’s full focus on the oil and gas exploration and production assets is happening ahead of our schedule,” Delek’s chief executive, Asaf Bartfeld, said in a statement. “In light of this success, we are considering the possibility of dual listing Delek Group’s shares on the primary market of the London Stock Exchange.”

Delek also said it was in talks to sell Roadchef, one of Britain’s leading roadside service area businesses. No further details were provided.

Delek lost 600 million shekels ($168 million) in the second quarter, including one-time write downs of 715 million shekels, compared with net profit of 513 million a year earlier. Revenue fell to 4.98 billion shekels from 5.08 billion.

“While the write-downs did have an impact on our profit in the second quarter, we see this as a short-term and non-cash event,” Bartfeld said.

Delek, through its subsidiaries, has major shares in several significant gas fields off Israel’s coast. The Tamar field, which Delek developed together with Texas-based Noble Energy, has estimated reserves of 11 trillion cubic feet (tcf) and began production last year.

The contribution to net profit from gas production was 56 million shekels in the second quarter, compared with 10 million a year ago.

Nearby Tamar is Leviathan, with an estimated 22 tcf of reserves and set to come online in 2017.

Delek declared a dividend of 150 million shekels or 12.78 shekels a share.

($1 = 3.57 shekels)

Reporting by Tova Cohen; Editing by Steven Scheer

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