Auto importer George Horesh, one of Israel's wealthiest people, is entering the energy field. Sources inform "Globes" that Horesh is likely to buy nearly 10% of the Dalia private power plant for NIS 200 million. The deal reflects a NIS 2.2 billion value for Dalia Power Energies, which owns Israel's largest private power station, the same value as in other recent deals in its shares. Up until now, other than his main auto business, Horesh has invested mostly in real estate and high tech.
The seller in the deal is a group of shareholders in Sigma Epsilon, one of the power station's founders. The company owns 6.7% of Dalia Power Energies through its Sigma Epsilon Power Engineering subsidiary, and also owns half of Hiram Epsilon, which has a 25.7% stake in Dalia Power Energies.
Sigma Epsilon, which is an active partner in Dalia in both engineering and commercial aspects of the project and in making decisions, is held by a group of energy professionals, including former Bateman Engineering CEO Eli Barnea, former Israel Electric Corporation (IEC) (TASE: ELEC.B22) senior VP and chief engineer Moshe Lasry, the late former IEC R&D department manager Yigal Porat, Samir Khouri, Elias Khouri, Eyal Lifschitz, and Doron Lifschitz.
The Dalia power plant was built at the Tzafit site near Kibbutz Kfar Menachem, in accordance with the government's policy of encouraging competition in the Israeli electricity sector. The power station is based on combined cycle technology, and operates using a gas turbine and a steam turbine with a 900-megawatt capacity, with 58% maximum energy efficiency.
Dalia is a key player in the electricity market, accounting for 7% of power production in Israel. The total cost of the power station at Tzafit is NIS 3.5 billion. In addition to the owners, Bank Leumi (TASE: LUMI) took part in financing it as a senior debt organizer, and six leading Israeli financial institutions also took part. The chairman of Dalia Power Energies is Kibbutz Economies Group chairman Doron Set, and the CEO is former Jerusalem municipality CEO Eitan Meir.
Global infrastructure company Alstom began construction work on the power station in February 2013, and commercial operation began in July 2015. The power station operates continuously using natural gas, and can also be operated with diesel fuel as a backup in case the supply of natural gas is disrupted. The Tamar partnership is the gas supplier for Dalia under a 17-year agreement signed in 2012 for an annual supply of 1.1 BCM.
Up until recently, the shareholders in Dalia Power Energies were Kibbutz Economies Group (47%), Hiram-Epsilon (25.7%), Sigma Epsilon Power Engineering (6.7%), and a group of investors that acquired the 20% stake of Israel Infrastructure Fund last year for NIS 430 million. The group includes Mexican-Jewish entrepreneur Jusidman, businessman Zvi Barak, and the elementary school, kindergarten, and high school teachers' advanced training funds owned by the Israel Teachers Union and the state. Under another recently signed deal, Kibbutz Economies Group is set to sell 7% of its shares to existing shareholders in Dalia Power Energies and to Israel Infrastructure Fund, which is again investing in the power station, after selling its holdings in 2016.
Published by Globes [online], Israel Business News - www.globes-online.com - on September 25, 2017
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