The battle between Israel's large fuel companies over the acquisition of gas stations is breaking all bounds. Yitzhak Tshuva-controlled Delek Group Ltd. (TASE: DLEKG) subsidiary Delek Israel Fuel Corporation Ltd. (TASE: DLKIS) is liable to lose two of its major gas stations in central Israel in favor of Paz Oil Company Ltd. (TASE:PZOL) and Sonol Israel Ltd.
Sources inform ''Globes'' that Paz, controlled by Zadik Bino, is likely to take over the operation of the Orly gas station on Geha Road (Road 4) near Givat Shmuel in 2010. This is one of Delek Israel's strategic gas stations. It includes a convenience store, and sells an estimated two million liters of fuel a month.
Delek Israel's contract with the Orly gas station's owners is due to expire in December, and Paz has reached a deal with the owners to take it over at the beginning of next year. Fuel industry sources believe that Paz will pay the owners NIS 600,000 in rent per month.
Sonol, controlled by David Azrieli through Azrieli Group subsidiary Granite Hacarmel Investments Ltd. (TASE: GRNT), has taken over Delek Israel's largest gas station in the Rosh Ha'Ayin area. The gas station at the entrance to the town sells about one million liters of fuel a month. Delek Israel has operated the gas station for years. It is owned by Yosef Yitzhak, the son of Mati Yitzhak, the chairman of the Independent Gas Station Owners Association.
The Geha Road and Rosh Ha'Ayin gas stations sell 30 million liters of fuel a year altogether, amounting to NIS 150 million revenue. Fuel industry sources believe that Delek Israel is unlikely to ignore Paz and Sonol's challenge, and that it will take legal action to try to prevent the transfer of the two gas stations.
Delek Israel has already sought an ex parte injunction against the transfer of the Rosh Ha'Ayin gas station to Sonol, but the application was dismissed. The hearing at the Petah Tikva Magistrates Court will resume in the presence of both parties.
At the same time as it conducts a legal battle, Delek Israel is trying to fight back. In response to the action in Rosh Ha'Ayin, it took over a Sonol gas station next to the Kanyon Hazahav in Rishon LeZion. Delek Israel will pay NIS 200,000-250,000 in rent a month for the gas station, which sell 500,000 liters of fuel a month.
Published by Globes [online], Israel business news - www.globes-online.com - on April 30, 2009
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