19 Million Shares in Dead Sea Works Sold Before Public Issue is Made

The Dead Sea Works, Ltd., announced last night the flotation of an issue of 27, 000, 000 ordinary shares as part of a massive financing of a major expansion of production of minerals from the Dead Sea.

Most of the new issue has already been underwritten by Israeli banks, special funds of scientific institutions such as the Hebrew University, the Israel Institute of Technology and the Weizmann Institute, some industrial and economic agencies, the Palestine Economic Corporation and AMPAL. Four million of the shares have been underwritten by two British banking firms, N. M. Rothschild and S,G. Warburg and Company.

Only 7, 500, 000 shares will be offered to the Israel public, with priority for purchase to workers and members of the Dead Sea Works staff. The shares have a par value of one pound and are being sold at seven percent above par.

The overall expansion planned will require an investment of 128, 000, 000 Israeli pounds ($61, 000, 000). This will come from varicus sources: the stock flotation, loans from the World Bank and American banks, from capital funds of the company and other sources.

The expansion plans envisage an increase in the production of potash from 135, 000 tons in 1960 to around 200, 000 tons by 1963 and to 400, 000 tons by 1966 when additional dams are completed.

Output of bromine and bromides, now approaching 3, 000 tons a year, would be increased to 10, 000 tons a year by January 1962. A new plant in Beersheba will produce 2, 000 tons of various bromide by-products at that time. By 1963, it is expected to reach 75, 000 tons of magnesite a year and a new table salt plant will produce 20, 000 tons of such salt each year.

Mordecai Makleff, general director of the Dead Sea Works, said that there were no problems in marketing the products. He reported that potash output for 1961 and 1962 had already been sold. He added that the company also had standing contracts for almost half of its potash output until 1969. He said this was also true for output of magnesite and bromine and bromine by-products. After deductions for income taxes, the company hopes to reach a net return of from 13 to 15 percent of the total value of the capital of the share issue, He predicted this percentage would rise from 22 to 33 percent during 1968 and 1969.

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