Azorim, Engel Resources planning $460m Ukraine project

Shaya Boymelgreen is trying to create synergy between his Israeli subsidiaries. Azorim Investment, Development and Construction Ltd. (TASE: AZRM) and a subsidiary Engel Resources and Development Ltd. (TASE:ENRS) are negotiating to buy in equal shares in a 1,400-dunam (350-acre) lot 45 kilometers from Kiev for $32 million. Azorim controls Engel Resources through Lagna Holdings Ltd. (TASE;LGNA).

The lot is zoned for the construction of 1,250 houses, a shopping center, and public buildings at an estimated cost of $360 million, including the land. The companies expect $460 million in proceeds from the project. They will consider developing the residential project as a mixture of houses and apartment blocks. Construction is due to begin within a year and take five years to complete.

Engel Resources said that it wanted to partner with Azorim in the project because of its experience in the field and to fulfill Boymelgreen's wish that the companies collaborate.

In addition, Azorim and Engel Resources have signed a contract with LR Group, and Israeli company with 15 years experience in Ukraine, to build the project. Engel Resources will own 79% of the joint venture and LR Group will own 20%, with 1% owned by another party. Engel will finance 85% of the investment in the project and LR Group will finance the rest.

Published by Globes [online], Israel business news - www.globes-online.com - on December 5, 2007

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