Multimatrix Ltd. (TASE: MLTX) has signed a letter of intent to acquire 50% of electricity production rights by a wind farm from Mei Golan Wind Energy Development (1988) Ltd. for NIS 38 million. Multimatrix will also provide a NIS 42 million owner's loan to Mei Golan, for a total investment of NIS 80 million.
At the end of the third quarter, the company had just NIS 100,000 in cash, excluding deposits on which there are liens, and NIS 64 million in liabilities, mostly to the banks.
A subsidiary will be set up, Tzahal Holdings Ltd., which will own the wind farm operations, develop new wind farms in Israel and abroad, analyze wind measurements in Israel, and sign a services agreement with Green Wind Energy Ltd.
Mei Golan's wind farm generates six megawatts, which the company is due to expand to fourteen megawatts. The company and its partner AES Corporation (NYSE: AES) also owns up to 50% of a 400-megawatt wind farm project. Multimatrix's financial report gives an estimated company value of $113-133 million for Tzahal Holdings.
Multimatrix's share price rose 9.7% to NIS 1.30, giving a market cap of NIS 45 million.
Published by Globes [online], Israel business news - www.globes-online.com - on December 2, 2010
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