Sources inform ''Globes'' that Carmel tunnels franchisee Carmelton Ltd. is in talks to sell 10% of its shares to KCPS Israel Private Equity Partners LP. In its financial reports, Carmelton partner Shikun u'Binui Holdings Ltd. (TASE: SKBN) conservatively records its stake in the company at just NIS 68 million, which means that if a sale is closed at a high company value, Shikun u'Binui will record a large capital gain of hundreds of millions of shekels.
Carmelton is owned in equal shares by Arison Holdings Ltd. subsidiary Shikun u'Binui and Ashtrom Properties Ltd. (TASE:ASPR). China Civil Engineering Construction Corporation (CCECC) is the contactor. Construction of the tunnels began in early 2006.
Carmelton was founded in 1997 to dig the Carmel Tunnels under a BOT (build, operate, transfer) contract, including the right to collect tolls through 2040. The tunnels are due to open by the end of this year, four months ahead of the schedule as stipulated in the franchise contract with the government.
At the end of the franchise period, the tunnels will revert to state ownership at no compensation. The project includes two parallel six-kilometer tunnels - Israel's longest - and an interchange with seven overpasses. The tunnels connect the Coastal Road (Road 2) at the southern entrance to Haifa with the Check Point junction at the northern entrance, and include a mid-point interchange at Ruppin Road.
Published by Globes [online], Israel business news - www.globes-online.com - on May 16, 2010
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