[Boycott - Divestment]
Harvard Divests From Israel
16 August 2010
Harvard Management Company, which manages the university’s endowment, has divested the fund from all investments it had in Israel companies, during the second quarter of this year. The divested stocks include TEVA, a generic drug manufacturer, that has greatly benefited from Israel’s strangulation of several Palestinian pharmaceutical companies, Checkpoint Securities, which provided many of the technologies Israel uses humiliate, screen, and search Palestinians at road blocks, and Cellcom, a wireless communications company that provide communication services to the army, among others.
College-based divestment campaigns have intensified over the past few years, Harvard University included. And while the university made no statement in favor of divesting from Israel on ethical, human rights grounds, it is not unlike the administration to make such a move quietly and preempt having to answer to to immorality of holding such investment and hypocrisy in retaining them while touting the divestment from Apartheid South Africa as beacon of progressive ethic.
The divestment Announcement came in a 13-F form filing to the US Securities and Exchange Commission on Friday, as reported by the Israeli business daily, Globes.
Harvard University fund sells all Israel holdings
Hillel Koren, Globes - Israel business news
15 August 2010
In another blow to Israeli shares, the Harvard Management Company notified the US Securities and Exchange Commission (SEC) on Friday that it had sold all its holdings in Israeli companies during the second quarter of 2010. No reason for the sale was mentioned. The Harvard Management Company manages Harvard University's endowment.
Harvard Management Company stated in its 13-F Form that it sold 483,590 shares in Teva Pharmaceutical Industries Ltd. (Nasdaq: TEVA; TASE: TEVA) for $30.5 million; 52,360 shares in NICE Systems Ltd. (Nasdaq: NICE; TASE: NICE) for $1.67 million; 102,940 shares in Check Point Software Technologies Ltd. (Nasdaq: CHKP) for $3.6 million; 32,400 shares in Cellcom Israel Ltd. (NYSE:CEL; TASE:CEL) for $1.1 million, and 80,000 Partner Communications Ltd. (Nasdaq: PTNR; TASE: PTNR) shares for $1.8 million.
Harvard Management Company's 13-F Form shows some interesting investments. Its two largest holdings, each worth $295 million, are in iShares ETFs, one on Chinese equities, and the other on emerging markets. Harvard also owns $181 million in a Brazilian ETF.
Harvard Sells Off Its Investments in Israel
Benjamin Joffe-Walt, The Media Line
16 August 2010
Harvard University sold all its shares in Israeli companies during the second quarter of 2010, the investment group which manages the university’s substantial endowment has reported to US Securities and Exchange Commission (SEC).
The university, which has the largest endowment of any school in the world, sold its $41.5 million holdings in a number of prominent Israeli companies, including $30.5 million of stock in Teva Pharmaceutical Industries Ltd, $3.6 million in Check Point Software Technologies (an IT security firm), $1.8 million in Partner Communications Ltd., $1.67 in NICE Systems Ltd. and $1.1. million in Cellcom Israel Ltd.
The Harvard Management Company, which manages the university’s $26 billion endowment, reported the divestment to the SEC on Friday but has not announced a reason for the sale.
The move was lauded by advocates of the international campaign for boycotts, divestment and sanctions (BDS) against Israel to push the country to withdraw from all territories occupied in the 1967 War and abide by international law.
“We welcome Harvard’s decision, and encourage all academic institutions in the US and elsewhere to follow its lead, to invest in socially responsible investments, and divest from Israeli war crimes,” Hind Awwad, Coordinator of the BDS National Committee in Palestine told The Media Line. “After Israel’s war of aggression on Gaza in 2008/2009, and its recent attack on the Freedom Flotilla, the Global BDS campaign has gained great momentum.”
Industry analysts, however, say the move was economic, not political.
“This is pure economics and I don’t think it was because of the Arab boycott,” Dr. Gil Feiler, founder of Info-Prod Research (Middle East) Ltd and director of the Middle East Business and Economic Research Institute at Interdisciplinary Center Herzliya told The Media Line. “They didn’t eliminate their investments in Israeli stocks,” he claimed. “They still have tens of millions of dollars invested, and if you are going to boycott Israel you sell all your stocks.”
Shirley Adler, Investor Relations Coordinator at Cellcom, Israel’s leading mobile communications firm, told The Media Line that the company had no official indication from Harvard as to the reasoning behind the decision.
Yaacov Heen, Cellcom’s Chief Financial Officer, said the divestment is in response to Israel’s recent reclassification as a developed economy.
“It’s more technical than strategic or an issue against Israel,” he told The Media Line. “I have asked my international relations people to check it and we believe it’s because Israel was reclassified as a MSCI developed country in May 2010.”
Formerly the Morgan Stanley Capital International, MSCI World, is an international index of 1,500 stocks from a couple dozen ‘developed’ countries and is often used as a benchmark by global stock funds. In May MSCI upgraded Israel from an ‘emerging’ economy to a ‘developed’ economy.
“There are some funds which invest only in emerging markets,” continued Heen, the Cellcom CFO. “So Harvard had to sell our stock because Israel is no longer classified as an emerging market and they no longer have the ability to hold this stock within the emerging markets fund.”
“We have seen a real change in the volume of trade since they reclassified us,” he said. “In the longterm this is good news for us because there is now more money that can be invested in Israel, but in the short-term it means we need to work to find new investors.”
“The problem is that Israel is very small compared to other developed countries so we have to compete on a much higher level,” Heen added. “When we traded against emerging countries it was very easy to compete for investors.”
A number of major institutions, including U.S. universities and state pension funds in Europe have signed onto the BDS movement and divested from Israel. There is an active campaign to convince administrators at Harvard, the oldest U.S. institution of higher learning, to divest from Israel.
“Harvard University’s decision to sell all Israel holdings is indicative that investors are getting wary of investing in Israel,” said Awwad, coordinator of the Palestinian BDS campaign. “While the Harvard Management Company did not give a reason for its decision, it is indicative of the indirect, ripple effects that the global BDS movement is having: it is becoming unprofitable to invest in Israel.”
But Dr. Feiler, an expert in Israeli trade with Middle Eastern nations, argued the BDS movement, which he referred to as an ‘Arab’ boycott, is losing steam.
“The Arab boycott of Israel has no bite anymore, not economically and not in terms of perception,” he said. “They cannot even call a quorum in their meetings.”
“Israel is a huge market, buying much more than the Arab countries. The Israeli stock exchange is much bigger than a few Arab stock exchanges put together, and the Israeli GDP per capita is larger than even Saudi Arabia.”
Harvard invests $10 million in Turkish bonds
UĞUR KOÇBAŞ, Hurriyet Daily News
17 August 2010
Harvard Management Company, or HMC, a Harvard University financing group with assets totaling $35 billion, has ceased investing in Israeli companies in favor of Turkish bonds.
The total value of HMC’s investments in Israeli companies was valued at nearly $48 million in the 1st quarter of the year, yet in the 2nd quarter HMC pulled its interests out of Israel. The university-based company then decided to invest in Turkish bonds to the tune of nearly $10 million.
Harvard University, founded in 1636, established the HMC in 1974 in order to direct university donations and assets into new investments. The company aims to use these significant assets to providing a higher quality education for its students and attract the highest quality faculty members.
Jane L. Mendillo, President and Chief Executive Officer, said the company earns between 20 percent and 25 percent each year.
At the moment Chinese companies and bonds are the highest ranked foreign investment on the list of HMC’s international interests, whose total value increases nearly annually. In the 1st quarter of 2010 HMC invested $7 billion in Chinese companies and bonds.
Shares of $48 million
The company’s investments are tracked closely by others as many firms consider HMC a visibly profitable reference point while making new investments. The companies and the bonds HMC invests in generally increase in value and also gain the prestige of being part of the Harvard University’s investment portfolio.
Within this context, the announcement that the group would be re-orienting its investment strategy caused a tense reaction in both the U.S. domestic lobby groups and Israel. The company announced they had sold all their shares, worth $48 million, in the following Israeli companies: Teva, Cellcom, Partner, Nice and Checkpoint.
The company then invested 10 percent of the income attained through the sales into Turkish bonds.
The company’s decision comes at a time when relations between Israel and Turkey are delicate, to say the least and has predictably caused negative reactions, with some opponents of the decision commenting on some web sites that the company was anti-Semitic, reportedly describing the decision “too politic.”
This latest investment re-orientation does not represent the 1st first time HMC and the U.S. pro-Israel lobby have been involved in a public dispute.
In 2006, Stephen Walt, dean of the Kennedy School of Government, one of the most prestigious political science schools in the United States, wrote in an article that the foreign policy of the U.S. was a captive of Jewish lobby groups and pro-Israel foreign policy. In the same article, Walt also called on the U.S. to get out from under Israel’s thumb.
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