Menorah Mivtachim to invest $60m in solar energy

Solar field  picture: photo to go
Solar field picture: photo to go

The insurance group will invest jointly with the Canadian Solar company.

Menorah Mivtachim Holdings Ltd. (TASE: MORA), headed by chairman Eran Griffel and managed by CEO Ari Kalman, is cooperating with the Canadian Solar company "for an investment in solar energy in Israel." The two companies plan to jointly invest in development, financing, construction, and ownership of solar energy projects amounting to $60 million (NIS 210 million). Each party in the agreement will contribute half of the investment. The two companies explain that they joined forces in order to invest in projects "that will profit from the policy of the government and the Ministry of National Infrastructure, Energy, and Water Resources to promote environmentally friendly energy in general, and solar fields in particular."

The investment is not the first direct one by Menorah in this sector. Menorah initiated and developed solar energy activity in Italy in recent years through its Menorah Mivtachim Holdings subsidiary. According to the company's announcement, Canadian Solar was founded in 2001, and has supplied over 21 gigawatts of electricity over the years to more than 100 countries worldwide. Menorah Mivtachim's current market cap is NIS 2.82 billion, after the company's share price climbed 32.5% since the beginning of the year.

This investment follows other solar energy investments by investment institutions, but this time not using money from its members and policyholders. The money will come from the insurance company's nostro funds. The investment will be made by Menorah Mivtachim Energy, which will be the formal entity connected with the Nasdaq-listed Canadian company, which is regarded as an important international player in the field.

Embarking on non-financial investments

The major investment institutions "suffer" from enormous stores of cash for investment. This consists mainly of their members' money, but not exclusively so. They are searching for long-term investment instruments with no direct connection to what is happening in the capital markets. In this framework, they have been entering non-financial fields with multi-year growth potential in recent years. Infrastructure and energy interests them in this context. They have also been investing in special purpose vehicles in this sector, including the Noy and Israel Infrastructure funds

Prominent direct investments by investment institutions include Enlight Renewable Energy, a subsidiary of Eurocom Group, controlled by Shaul Elovitch. Enlight is leading a solar energy investment venture in overseas renewable energy projects. The project, called "Movilim," is jointly held by Menorah Mivtachim (50%) and other investment institutions: Harel Insurance Investments and Financial Services Ltd. (TASE: HARL) (10%), Migdal Insurance and Financial Holdings Ltd. (TASE: MGDL) (20%), and The Phoenix Holdings Ltd. (TASE: PHOE1;PHOE5) (20%).

Published by Globes [online], Israel Business News - www.globes-online.com - on October 19, 2017

© Copyright of Globes Publisher Itonut (1983) Ltd. 2017

Solar field  picture: photo to go
Solar field picture: photo to go
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