Three consortia enter NIS 2b Ashdod desalination tender

Three consortia have bid in the NIS 2 billion turn-key tender to build and operate the Ashdod desalination plant. The tender was published nine months ago. The bidders are:

• IDE Technologies Ltd., owned in equal shares by Delek Group Ltd. (TASE: DLEKG) and Israel Chemicals Ltd. (TASE: ICL). It did not submit a joint bid with its partner in the Soreq desalination plant tender, Hutchison Whampoa Ltd. (HKSE: 0018) unit Hutchison Water Ltd.
• BGS Desalination Consortium, comprising Arison Holdings Ltd. unit Shikun u'Binui Holdings Ltd. (Housing and Construction) (TASE: SKBN) together with Azrieli Group unit Global Environmental Solutions Ltd. (GES), Shafir Civil and Marine Engineering Ltd., and Baran Group (TASE: BRAN; Pink Sheets:BRANF).
• IVM joint venture of Minrav Holdings Ltd. (TASE: MNRV) and Spain's Valoriza Agua SL, a division of Sacyr Vallehermoso SA (IBEX: SYV)subsidiary SADYT.

The Ashdod desalination plant is due to produce 100 million cubic meters of fresh water a year beginning in 2012 at a 65-dunam (16.25-acre) site in the north Ashdod industrial zone. Mekorot National Water Company subsidiary Mekorot development & Enterprise Ltd. will operate the plant for 25 years, under a BOT (build,operate, and transfer) contract with the government.

The tender gives the winner an option to acquire up to 40% of the desalination plant company.

Kardan NV (TASE: KRNV;AEX:KARD) unit Tahal Group, and France's Veolia Environnement SA (NYSE: VE; Euronext: VIE) withdrew from the tender in view of its complexity and short construction timetable.

Bank Hapoalim (TASE: POLI) will lead the funding for the project. The European Investment Bank (EIB) reportedly wants to join on up to half of the NIS 1.5 billion financing for the project.

Published by Globes [online], Israel business news - www.globes-online.com - on October 19, 2009

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