The privatization of the Eilat Port Company Ltd. is underway. The ministerial privatization committee today authorized the Government Companies Authority, run by director general Doron Cohen, to begin the privatization of Israel's third largest port.
Minister of Finance Yuval Steinitz said that the decision "is a key act in the privatization of the ports."
Cohen said that the privatization of the Eilat Port was intended to speed up the port's operations and logistics by a private party experienced in port operations.
Today's decision follows the cabinet decision from 2005 to reform the ports. The ports reform includes selling the operating rights at the ports for 15 years, with an option to extend for 10 years.
A plan to move the Israel Navy base in Eilat to the area of the civilian port delayed the privatization of the port until now. It recently became clear that moving the navy base to the civilian cost would be very costly, and that a military presence in the port would result in restrictions on the types of cargo that the port could handle. Consequently, it was decided to keep the base at its present location, but to reduce its area. The vacated land will be used for Eilat's tourism development.
The Government Companies Authority has not yet decided whether to sell the Eilat Port as is, or to create a special purpose company. The Eilat Port handles 6% of Israel's marine cargo. Its main cargo last year was the import of 140,000 motor vehicles, which accounted for 65% of the port's activity, and the export of 2.4 million tons of phosphates.
Eilat Port posted a net profit of NIS 20 million on NIS 100 million revenue in 2009. It has 130 employees.
Published by Globes [online], Israel business news - www.globes-online.com - on December 6, 2010
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