Eilat Port privatization underway

The government plans to sell its entire stake in the Eilat Port Company to a private franchisee for about NIS 100 million.

The Government Companies Authority today began the prequalification stage of bidders in the tender for the sale of the government's stake in the Eilat Port Company Ltd. This is the first stage in the privatization of Israel's seaports. The government plans to sell its entire stake in the Eilat Port Company to a private franchisee for about NIS 100 million.

The franchisee will receive from the minister of transport a license to operate the Eilat Port for 15 years, with an option to extend for ten years, subject to meeting container traffic volume quotas at the port during the first three years of the operating period.

Minister of Finance Yuval Steinitz said that this was an important step toward implementing the 2005 ports reform. Government Companies Authority director Doron Cohen said that the privatization of the Eilat Port Company would help realize its cargo and tourism potential. He said that, since the beginning of the year, 10,000 passengers have passed through the port's passenger terminal, which was opened last year.

Foreign and Israeli companies are expected to participate in the tender. They include Taavura Holdings Ltd., owned by the Livnat family, which is a declared monopoly in the transportation of cars. 45% of Israel's cars are imported through the Eilat Port. 120,000 cars passed through the port in 2010, down from the 140,000 cars that passed through in the peak year before the global credit crisis.

Shlomo Meltzer, the controlling shareholder in S. Shlomo Holdings Ltd. (TASE:SHLD), which owns the Shlomo Sixt car leasing and rental company, and an owner of Israel Shipyards Ltd., the private port in Haifa, is also interested in the tender.

In 2010, the Eilat Port exported 2.3 million tons of chemicals from Israel Chemicals Ltd. (TASE: ICL) to Asia. The Eilat Ashkelon Pipeline Company Ltd. fuel terminal, which can import and export crude oil and refined oil products, is close to the port.

Later, the government plans to sell 20% of Ashdod Port Company Ltd. and Haifa Port Company Ltd.

Published by Globes [online], Israel business news - www.globes-online.com - on April 4, 2011

© Copyright of Globes Publisher Itonut (1983) Ltd. 2011

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