Sources inform ''Globes'' that B. Gaon Holdings Ltd. (TASE: GAON) is in talks to buy two foreign companies, one in water and the other a retailer. The price tags reportedly amount to tens of millions of shekels.
Gaon Holdings is focusing its business in three areas - financial services, retail, and water/ cleantech - which it believes have high growth potential. The company intends to be a market leader in each of these fields. The move abroad is part of this effort.
Gaon Holdings' current business is mostly in Israel. Its diversified retail businesses, including DIY and auto parts chain Ace Auto Depot Ltd. (TASE:ACDP), have annual turnover of NIS 1.4 billion. It also owns half of Ahava Dead Sea Laboratories Ltd. and a stake in Sheinkin Candles.
Subsidiary Gaon Agro Industries Ltd. (TASE: GAT) handles part of the company's water and cleantech interests. Gaon Agro posted a net profit of NIS 15 million on NIS 326.5 million revenue. However, most of Gaon Holdings' revenue in this sector comes from subsidiary Middle East Tube Ltd. (METCO) (TASE: TUBE). The company also invests in cleantech start-ups through Aguagro Fund LP.
Gaon Holdings CEO Shai Preminger told "Globes", "We're a leading player in the water industry. Each of our agro companies is a leader in its field, and we're now considering investing in foreign companies in this sector. This will generate high growth rates in the future."
How will you finance the acquisitions?
Preminger: "We have NIS 250 million in cash, at our various subsidiaries, which is intended for investment in the relevant fields. We also have options on the basis of our recently published shelf prospectus."
Published by Globes [online], Israel business news - www.globes-online.com - on July 6, 2010
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