Shikun & Binui Holdings Ltd. (TASE: SKBN), controlled by Shari Arison, is on the way to becoming Israel's largest solar energy company thanks to the acquisition of three major solar energy ventures. Sources inform ''Globes'' that subsidiary Shikun & Binui Renewable Energy Ltd. has signed a letter of intent with SunPower Corporation (Nasdaq: SPWR) of the US for an option to acquire three solar energy ventures, which will cost an estimated NIS 900 million to build.
Shikun & Binui will acquire full ownership of the ventures' special purpose companies and their engineering, procurement and construction (EPC) contracts for three 35-megawatt venture to be built on land leased from Kibbutz Urim, Moshav Beit Hagadi, and Moshav Nevatim in the Negev. Exercising the option is subject to obtaining electricity rates for the ventures and approval to transfer ownership of the ventures by the minister of energy and water resources.
Solar energy market sources, which were not involved in the deal, estimate the value of the option at NIS 12-14 million.
The three ventures are on the waiting list for obtaining provisional electricity rates. Currently, 182.5 megawatts of the 200 megawatts allotted to large solar energy ventures (larger than 10 megawatts) have already been awarded to projects: the Ramat Hovav Regional Industrial Council (37.5 megawatts); a venture of Arava Power Company at Kibbutz Ketura (40 megawatts); and ventures of EDF Energy Nouvelles SA (50 megawatts). Solar energy market sources believe that one of Sunpower's ventures will probably be included in the current quota, but possibly on a smaller scale, and that inclusion of all three ventures is possible if the recommendations of the ministerial committee on renewable energy to add 300 megawatts in solar energy ventures, including 100 megawatts for large ventures, is approved.
If all three of the options with SunPower are exercised, this will triple the capacity of photovoltaic solar energy ventures in the portfolio of Shikun & Binui, which is run by CEO Ofer Kotler. Shikun & Binui Renewable Energy, run by CEO Amir Levy, owns mid-sized solar energy ventures with an aggregate capacity of 26 megawatts, and ventures in the planning stages with an additional aggregate capacity of 35 megawatts.
Shikun & Binui is also in advanced talks with Spain's Abengoa SA (BMAD: ABG) to sign an agreement with the government to build a 120-megawatt thermosolar power station on state-owned land at Ashelim. Shikun & Binui is also moving forward on construction of another 120-megawatt thermosolar power station on land leased from Kibbutz Zeelim. The total investment in these two power stations is estimated at over $1 billion.
Published by Globes [online], Israel business news - www.globes-online.com - on February 11, 2013
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