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Client updates / IPOs and Public Offerings
A wave of IPOs continues to flood the market, prompting the Israel Securities Authority to publish a new staff position paper discussing three key topics.
Over the past year, raising capital through SPACs has become a hot trend on Wall Street. The Israel Securities Authority recently published the conditions and principles for SPACs to launch IPOs.
The Israeli Securities Authority has announced that distribution entities now may be liable for the contents of a prospectus. In a staff position paper published in late July, the ISA changed the rules of the game in the underwriting field by determining that a distributor, or an entity associated with a distributor, that purchases securities during an issuance and sells them within a short period of time (six months or less) shall be viewed by the ISA as an underwriter and shall be liable for the prospectus.
The Israel Securities Authority (ISA) recently published an advisory document for public comment ahead of the publication of a legal memorandum for the regulation of the securitization field in Israel.
The Israel Securities Authority (ISA) recently published a proposal for amending the Securities Law as to the supervision of underwriters and distributors.
On April 12, 2019, Arcturus Therapeutics Ltd., an Israeli public company traded on NASDAQ, published in the United States a prospectus and proxy statement (convening a general meeting of shareholders of the company). Publishing the prospectus is an advanced step toward completing an arrangement between the company and its shareholders.
On April 7, 2019, the Tel Aviv Stock Exchange (TASE) published a proposed amendment to the Stock Exchange Regulations, whereby the barriers to the entry of new TASE members will be removed and for the first time Israeli entities will be allowed entry into the stock exchange even if they operate exclusively for nostro.
With an eye to these other major markets, the Israel Securities Authority (ISA) has promulgated draft regulations for public comment that enable all reporting companies in Israel, who so desire, to publish their reports in English.
Recently, a four month proxy fight over control of an Israeli incorporated NASDAQ traded company was settled, following a series of proceedings held before the Tel Aviv District Court. At a crucial juncture, the Tel Aviv Court was asked to issue a temporary injunction over a transaction initiated by the board, which included a highly dilutive (24.9%) issuance of shares.
It is not uncommon for Israeli incorporated companies to seek investments abroad. In many cases, such investments are done through public offerings on international stock exchanges. Securities issued by Israeli companies are traded on the NASDAQ, the London Stock Exchange and a variety of other exchanges, including Australia. These situations, which make perfect sense from a business perspective, give rise to interesting and sometimes quite complex legal issues.