Treasury picks 5 finalists in Eilat Port tender

The Ministry of Finance yesterday picked the five finalists in the tender for sale of the government's 100% stake in the Eilat Port Company Ltd. The winner will operate the port for 15 years with an option to extend for 10 years.

The finalists are Maman Cargo Terminals and Handling (TASE: MMAN), controlled by Nochi Dankner; Aviation Links Ltd. (TASE: AVIA), affiliated with Israel Chemicals Ltd. (TASE: ICL), controlled by Ofer Holdings Group; Gold Bond Group Ltd. (TASE:GOLD); Papo Maritime Ltd., owned by the Nakash brothers; and Gadot Group, owned by Yosef Maiman's Ampal-American Israel Corporation (Nasdaq: AMPL; TASE:AMPL).

The finalists will submit their final bids in two months. Ministry of Finance source believe that the decision on the sale will be made immediately afterwards.

The five finalists were picked from seven bidders, out of the 17 companies that initially participated in the tender. Officials from the Government Companies Authority, Israel Ports Development & Assets Company Ltd., and Tasc Strategic Consulting Ltd. reviewed the bidders' business plans.

The Ministry of Finance said yesterday that, in March, the Government Companies Authority would submit the decisions for protecting the state's vital interests in the Eilat Port, the safety net for its employees, and for import of motor vehicles from Asia through the port beginning in 2015, to the cabinet for approval.

Antitrust Authority director general David Gilo still has to review the bids by Maman and Aviation Links, after he and Government Companies Authority director Doron Cohen agreed that the effect of the winner of the tender on concentration in the economy would be reviewed during the tender stage itself. This will avoid a situation in which the Antitrust Authority vetoes the winner in the tender.

Cohen said, "The bidders' business plans meet the criteria of the objectives of the Eilat Port's privatization. We expect increased trade with the Far East, which together with the proper management of the port will boost the port's importance in Israel's foreign trade, promote competition, and create value for consumers, the business sector, and the economy as a whole."

Eilat Port posted a net profit of NIS 9 million on NIS 56 million revenue in the first half of 2011. The Ministry of Finance said that the port's buyer could greatly increase its volume of business, using the current potential of Israel trade with Asia.

The Eilat Port's main business is the import of cars and the export of chemicals. Docking by cruise ships has recently become another activity. The Ministry of Finance said that the port services provided by the tender's winner would be supervised and that the state would reserve the right the authority over vital economic and security interests.

Published by Globes [online], Israel business news - www.globes-online.com - on February 22, 2012