Company Energy economy The public agreed on the acquisition of the energy activity of its controlling shareholders – the kibbutz economies – in a share transaction. As part of the transaction, Mesek Energy will acquire the holdings of the kibbutz farms in the Dalia Energy power plant and in the Mi-Ram electricity infrastructure company, as well as activities in the field of electricity trade.
The acquired holdings include 40.67% of the shares of Dalia Energy, 50% of the shares of Mi-Ram, 100% of the shares of Tikum Teksur, as well as all the rights and obligations of the kibbutz farms in agreements signed with private electricity suppliers. According to the outline of the transaction, the energy sector will allocate 68% of its shares to the kibbutz economies, in exchange for the activities acquired.
This exchange ratio reflects a value of NIS 623 million for the energy economy and a total value of NIS 1.321 billion for the acquired activities. This is a value of NIS 1,293 (40.67%) in Dalia Energy and another NIS 28 million for the other components of the acquired activity.
According to Economy Energy, the value determined in the transaction corresponds to the range of valuation received by its special committee from its economic advisors. It cuts Dalia Energy as a whole worth NIS 3.18 billion, which is lower than the value it sought to issue at the beginning of 2021.
Economy Energy is engaged in the field of renewable energies in Israel, and was issued on the Tel Aviv Stock Exchange in June 2020. The company operates in a variety of renewable energy fields, including large-scale terrestrial solar projects; Solar installations on roofs; Floating systems on reservoirs and their walls; Storage systems and infrastructure for electric transportation.
Eight shopping organizations of the kibbutzim and moshavim, including the kibbutz farms themselves, currently hold 52.2% of the energy farm shares. The company expects that the acquisition will generate a revenue stream for it that will significantly increase its financial flexibility and its ability to expand its activities in the field of renewable energy and other areas.
“Become one of the largest energy groups in Israel”
Chen Melamed, CEO of Economy Energy, said that “When the acquisition of the kibbutz farms in Dalia Energy is completed, Energy Economy will become one of the largest energy groups in Israel, whose activities include generating and storing electricity from both renewable energy and natural gas, electricity supply, infrastructure deployment and charging electric vehicles. We are confident that the move will create great value for investors and increase competition in the Israeli energy economy, for the benefit of customers and the economy. “
Dalia Energy owns the Dalia private power plant at the Tzafit site in the Judean lowlands. The power plant is one of the largest in Israel and produces electricity using natural gas with a total capacity of 912 megawatts, which is supplied to the electricity company and private consumers.
Kibbutzim Farms is a holding organization whose goal is to build activities that provide strategic added value to its owners. The organization is an agricultural cooperative association established in 1996, and currently includes about 280 kibbutzim from all streams and cooperative moshavim.
The Kibbutz Farmers’ Association currently holds 6.56% of the shares in the Energy Farm, and is a party to an agreement with other shareholders, also economic organizations of the kibbutzim. As the transaction is completed, the kibbutz farms are expected to be the main shareholder in the energy economy – given the enormous value of its holdings in Dalia.
Negotiations with the kibbutz farms were conducted by Mesek Energy through a special independent committee appointed by the company’s board of directors. It was headed by external director Yael Andoren, and the committee also included deputy director Varda Kell and independent director Dorit Ben Simon.
At the end of about six months, the parties signed the sale agreements on Tuesday. The purchaser, Meshek Energy, was accompanied in the transaction by attorneys Nir Dash and Yotam Kleiman of Herzog Fox Ne’eman.
The Independent Committee of the Energy Farm was assisted by attorneys Lior Porat and Uri Heller of the Gornitzky & Co. firm and the economic consulting firm MNS. The kibbutz farms were accompanied by Adv.
The Energy Economy was traded after the transaction on the stock exchange at a value of NIS 700 million, which reflects an increase of about 50% since the company’s issuance in June last year.
Dalia asked for a high value – and the offering was canceled
Dalia Energy also tried to issue its shares to the public, and in February 2021 even published a prospectus. The company hoped Complete the issue at a value of NIS 5 billion “before the money”, and even include a sale offer of its shareholders in the amount of about half a billion shekels. Later, the company realized that this value was too high in relation to the price the market was willing to pay, and agreed to reduce the value before the money to about NIS 4 billion.
However, this value was also high for the perception of the institutional bodies, which set a maximum threshold for the company of only NIS 3.5 billion. Some of the shareholders objected to this threshold, and as a result the issue was canceled. Currently, the Kibbutz Farmers’ Association is selling its share in the company at an even lower value, of NIS 3.18 billion.
At the decision to cancel the IPO, Dalia Energy stated that “Dalia Energy’s shareholders believe in realizing the company’s strong improvement potential, based on their in – depth knowledge of the company and its operations. “.
Dalia Energy, founded in 2005, is owned by the kibbutz farms (40.67%), Daniel Husidman and Zvi Barak (20%), the George Horesh family (8.67%), Keren 5711 (5%) and Hiram Epsilon (25.66). %) Of the Landau family and the original entrepreneurs of Dalia.
Attorneys Esther Koren and Yifat Sheftel from the Gross firm, along with Uzi Mor and Tzuri Lavi from the Lipa firm, represented the kibbutz farms.