Israel Shipyards Industries today announced the expansion of the basket of services and products it will offer its customers in the construction industry in Israel, after a granddaughter company wholly owned by its subsidiary, Cement, signed an agreement to purchase development, production, and sale of construction adhesives and powders from Keshet Prima.
The consideration in the transaction is approximately NIS 61.5 million, financed by Cement’s equity and through bank financing. In addition, it was agreed that an additional consideration would be paid, that in certain circumstances the amount would not be less than a total of NIS 26.35 million, and would be determined on the basis of a mechanism determined between the parties and based on the company’s results for 3-5 years. The parties will also sign an agreement for the provision of services, including management services for a specified period of time.
The revenues of the acquired activity amounted to NIS 204 million in 2021, compared with approximately NIS 194 million in 2020. The operating profit of the acquired activity amounted to approximately NIS 28 million in 2021, compared with approximately NIS 23 million in 2020. Completion of the transaction is subject to completion of conditions Racks, including obtaining approval from the Competition Authority.
The expansion of the company’s activity in the field of construction through Cement and the addition of activity of development, production and sale of additional construction products, is in line with the company’s business strategy to expand the basket of services and products it offers its customers in the Israeli construction industry.
The collaboration with Cement will help Keshet expand the scope of its activity in the field of construction and benefit from the logistical, technological and financial capabilities of the Israel Shipbuilding Industries Group. Under the agreement, it was agreed that Dr. Raanan Geshuri, the company’s CEO, would continue to serve in his position for at least three years.
Shlomi Fogel, Chairman of Israel Shipbuilding Industries and Chairman of Cement: “We anticipate a significant increase in the Israeli construction market and intend to expand our activities in this field, as well as in other fields. “The acquisition of Keshet Prima’s operations serves the company’s long-term business strategy to continue to expand the range of services and products it offers to its customers in the construction industry in Israel and constitutes a significant tier in offering a more comprehensive and diverse range of solutions to these customers.”
Eyal Hecht, CEO of Cement: “Cement is constantly expanding and diversifying its areas of activity and entering activity in various markets and areas. In recent months, we have expanded our activities in the field of international maritime logistics and through the company’s fleet of cement ships. Cement moves cement from Greece, Turkey and Spain to Italy, England and the United States. Cement will continue to expand its business in accordance with the multi-year plan approved by the company’s board of directors. “
Keshet Prima was established about 35 years ago and is still owned by the Geshuri family, the founding family. The company is considered one of the leading manufacturers in Israel in the field of manufacturing adhesive mixtures intended for the construction industry, including adhesives for ceramics, plaster and more, a market that is estimated at NIS 800-900 million per year. Operates from the Nitzanei Shalom industrial zone and employs about 200 workers.
Cement, established in 2016, is considered the largest cement importer in Israel. The company controls the entire supply chain of cement to its customers, from importing cement directly from the world’s largest manufacturer through a fleet of ships owned by the company, through transporting and unloading at the company’s cement terminal at the Israel Shipyards port, storing and adjusting to customers’ requirements. The establishment of Cement led to a revolution in the cement industry in Israel and a decrease in the prices of cement and concrete, the establishment of new concrete plants and an annual saving of about NIS 2.5 billion for local authorities and government ministries.
The Israel Shipbuilding Industries Company is owned by Shlomi Fogel, Sami Katsav, the Schmelzer family and the stock exchange Gold Bond Group. The company, managed by Zvika Schechterman, has over 60 years of experience and is active in various fields, including: design and construction of military and civilian vessels in one of the most advanced shipyards in the world; Operation of the first private port in Israel; Cement import activity, in which the company became a leading player in the Israeli market within a few years; Logistics support activity in the gas production industry and owns a fleet of 13 ships. The company intends to develop a number of growth engines over the next few years.