Israel Infrastructure Fund (IIF) has exercised their first refusal rights to buy 49% of the government's rights in Road 6 (Cross Israel Highway or Yitzhak Rabin Highway) franchisee Derech Eretz Highways Ltd. and are increasing their stake from 50% to 75%. Derech Eretz's other shareholder, Shikun u'Binui Holdings Ltd. (TASE: SKBN) is not expected to follow suit, which will halve it holding in the company to 25%.
The decision blocks the effort by Noy Infrastructure Fund, owned by Poalim Capital Markets - Investment Bank Ltd. and Clal Insurance Enterprises Holdings Ltd. (TASE: CLIS) to acquire the rights.
IIF's partners include Harel Insurance Investments and Financial Services Ltd. (TASE: HARL), Leumi Partners Ltd., Altshuler Shaham Ltd., Amitim (the eight nationalized old pension funds). They raised the NIS 1.4 billion to acquire the rights, matching Noy Fund's bid. Harel, IIF's largest shareholder, with a 40% stake, will provide NIS 660 million of the amount. Leumi Partners will provide NIS 187 million.
IIF and Shikun u'Binui bought the holdings of Africa-Israel Investments Ltd. (TASE:AFIL) and Canadian Highways Investment Corporation's (CHIC) holdings in Derech Eretz in late 2010.
Published by Globes [online], Israel business news - www.globes-online.com - on August 11, 2011
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