Koor Industries Ltd. (NYSE: KOR) and Electric Fuel Corporation (NASDAQ: EFCX) yesterday completed and signed an agreement for the sale of Koor's total holdings in Tadiran Batteries to Electric Fuel. In return, Electric Fuel will issue 2.9 million shares to Koor, representing a 14% capital share and valued at $53.4 million, according to Thurday morning share prices on Wall Street. The transaction will be finalized in April.
The two companies reached agreement in principle on March 8. According to that agreement, Electric Fuel would acquire Tadiran Batteries from Koor for $40,000,000 in Electric Fuel's common stock, or 2,335,767 shares, based on Electric Fuel's closing price of $17.125 per share on that day. As of Thursday morning, Electric Fuel was trading at $18.125 bringing the value of the share bloc to $42.3 million.
In addition, Koor Industries will acquire additional 613,139 shares of Electric Fuel's stock at $17.125 per share, the price at the close of Wednesday's trading, for a total cash investment of $10,500,000. The value of this share bloc as of Thursday morning was $11.1 million.
After the transaction is complete, Koor's total holdings in Electric Fuel will amount to about 14% of common stock. Koor will obtain one seat on the Electric Fuel board. In all, Koor will hold a bloc of shares valued at $53.4 million, as of the opening of trading on Thursday morning.
Koor Vice Chairman and CEO, Jonathan Kolber said, ``the sale of Tadiran Batteries to Electric Fuel is an excellent transaction for both sides, granting Koor a valuable stake in a high growth company traded on Nasdaq.''
Electric Fuel President and CEO, Yehuda Harats said, ``The acquisition of Tadiran Batteries is significant to us for a number of reasons. First, based on Tadiran's 1999 trailing EBITDA figures, the acquisition will generate cash flow of approximately $6 million for Electric Fuel. Second, the acquisition will give Electric Fuel access to skilled human resources in all aspects of battery development, production, quality assurance and marketing,' including lithium batteries which he termed "an important asset."
Published by Israel's Business Arena on March 16, 2000.