Teva Selling Jerusalem Land Tenure Rights Ahead of Factory Closures

Teva Pharmaceutical Industries Ltd. has signed a deal to sell its land tenure rights in one of its Jerusalem factories, according to one person familiar with the matter who spoke with Calcalist on condition of anonymity. The buyer, Israel-based Meshulam Levinstein Constructing & Engineering Ltd., did not identify the seller in a Tuesday filing to the Tel Aviv Stock Exchange, but the person familiar with the matter said that the NIS 171 million (approximately $47 million) deal reported is for Teva's tablet manufacturing plant in Jerusalem's Har Hotzvim area.

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Teva has confirmed the report.

A second company, Vitania Ltd., announced in a Wednesday filing to the exchange that it has signed a deal to acquire land tenure rights in Jerusalem for NIS 107 million (around $30 million). While Vitania did not identify the seller in its filing, the address given is for Teva’s inhalers manufacturing facility in Jerusalem.

Teva two manufacturing facilities in Har Hotzvim are both slated for closure by the end of 2019 as part of the company's debt-ameliorating asset divestment plan announced December 2017.

The company’s tenure rights for the tablet factory land, which spans 31,000 square meters, will end in 2021. The deal is expected to be completed by June 2020, according to Levinstein's filing, and the all-cash payment will be given to Teva with the facility's closure, according to the person familiar with the matter.

Vitania stated the deal is expected to close by July 31.

The Jerusalem facilities are two of eleven facilities Teva said it would close or divest in 2019. In February, Teva signed a deal to sell its land tenure rights in a shut down facility in Israeli port town Ashdod for NIS 109 million (approximately $30 million). The same month, Calcalist reported that Teva has signed a deal to sell its still operational facility in northern Israeli town Kiryat Shmona.