Azrieli Group Ltd. (TASE: AZRG) industrial holding company Granite Hacarmel Investments Ltd. (TASE: GRNT) has signed a ten-year NIS 1 billion power purchasing agreement (PPA) with Israel Corporation (TASE: ILCO) subsidiary Rotem OPC Ltd. OPC will deliver 83 megawatts of electricity from its power plant that is under construction at Mishor Rotem. Granite Hacarmel has an option to extend the PPA by a further five years.
The electricity is for Granite Hacarmel subsidiaries, including paint manufacturer Tambour Ltd. (TASE:TMBU), fuel company Sonol Israel Ltd., and GES Global Environmental Solutions Ltd.
Granite Hacarmel has an option through January 2012 to increase purchases by 40 megawatts, and a second option to purchase a further 100 megawatts, under preset terms, if OPC builds a second power station.
The PPA will come into effect at the end of 2012, when the Mishor Rotem power station is due to come on line. If there is a delay, the agreement stipulates payments to Granite Hacarmel.
Azrieli Group's share price fell 1.1% to NIS 92.10, giving a market cap of NIS 11.2 billion, but Granite Hacarmel's share price rose 1.4% to NIS 657, giving a market cap of NIS 954 million. Israel Corp's share price rose 0.7% to NIS 3,600, giving a market cap of NIS 27.5 billion.
Published by Globes [online], Israel business news - www.globes-online.com - on June 26, 2011
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