Edeltech Group has announced that it has signed an agreement to acquire the full holdings of Zorlu Energy in Ezotech Electric, the joint venture through which Edeltech and Zorlu own power plants through Ashdod Energy and Ramat Negev Energy. The joint venture has cogeneration production licenses, and an aggregate electricity production capacity of 190 megawatts, along with related industrial services provided to nearby factories. To date, Edeltech and Zorlu owned 57.85% and 42.15% of Ezotec Electric respectively. On completion of the deal, which is subject to various conditions, including receiving regulatory approvals and the approvals of related bodies, the Edeltech Group will hold a 100% stake in each of the two power plants.
Zorlu Energy notified the Turkish stock exchange that the overall amount that it will receive for the sale of its rights in Ezotech Electric is NIS 127 million. According to Zorlu, the deal represents another step in a series of deals it has carried out inside Turkey and overseas, for the sale of its activity in gas-based power plants. However, it is impossible to ignore the timing of the deal, at a time when Turkey, for the first time, has imposed a trade embargo on Israel and relations between the countries are in a serious crisis. After the completion of the current deal, Zorlu will be left with another activity in the field of private electricity production in Israel, through its holding (25%) in the Dorad Energy power plant, which is working to increase the scope of its production capacity in the coming years.
"A strategic step by Edeltech"
The Ramat Negev Energy power plant has been operated by natural gas since 2016, and is located next to the Adama factory in the Neot Hovav industrial zone. The plant holds a cogeneration production license and has a 126 megawatts production capacity. In addition to this, the plant provides industrial services including steam, water treatment, and compressed air for nearby factories in the Neot Hovav industrial zone.
The second plant, Ashdod Energy, is located next to the Agan plant (also belonging to the Adama Group) in the Ashdod industrial zone, which has been operating since 2015. The plant holds a cogeneration production license and has a 64 megawatts production capacity. In addition to the Ramat Negev Energy and Ashdod Energy power plants, Edeltech Group also owns and operates (alone or together with other partners) the Orot Yosef power plant in Ramat Hovav and the Orot Pnina (Hagit East) and Dorad Energy.
Edeltech Group executive vice president Niv Sever said, "Acquiring the holdings of Zorlu in Ramat Negev Energy and in Ashdod Energy is a strategic step to strengthen the control and resilience in the Edeltech Group. "This is a strategic move by the Edeltech Group, which has ripened into a deal over the past year. The Edeltech Group thanks Zorlu for the good partnership in these power plants for over 15 years and for the continuation of the partnership in the Dorad power plant."
Zorlu Energy CEO Sinan Ak added, "As a global company, holding investments in various regions around the world, we also have natural gas power plants in Israel. In accordance with our strategy of investing in renewable energy sources in parallel with the changing needs of our world, we have been working for some time to sell our gas activity. And this, without harming our investors."
Edeltech Group was represented in the deal by Advs. Mike Rimon, Dorin Pendus and Yonatan Gazit of the Meitar law firm. Zorlu Energy was represented by Advs. Michal Lifton Sitbon, Yigal Binyamini and Daniel Amitai of the Goldfarb Gross Seligman law firm.
Published by Globes, Israel business news - en.globes.co.il - on May 30, 2024.
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