Clal Insurance buys 10% stake in Energean IPO

Mathios Rigas Photo: PR

Clal Insurance invested more than $100 million in the London IPO and has become the Greek energy company's third largest shareholder.

Clal Insurance Enterprises Holdings Ltd. (TASE: CLIS) invested more than $100 million for a 10% stake in Greek energy company Energean (LSE: ENOG) in its IPO in London on Friday. Energean raised $460 million, 95% of the $482 million that it had planned, in order to finance the development of the Karish and Tanin offshore Israeli gas fields.

Israeli institutions invested an estimated $140 million in Energean in the IPO with Clal Insurance investing the lion's share. Clal Insurance is now the third largest shareholder in Energean. The Greek company's major shareholders including Energean CEO Mathios Rigas bought $15 million of shares in the IPO, "in order to show their commitment to the project," a source told "Globes."

Earlier this month, Energean signed a $1.275 billion financing deal for the development of Israel's Tanin and Karish offshore natural gas fields. The financing was led by Bank Hapoalim (TASE: POLI), which will provide $375 million while Morgan Stanley, Societe Generale, and Natixis will each provide $300 million.

Energean acquired the Karish and Tanin reservoirs after the natural gas plan was approved by the government requiring Tamar and Leviathan partners Delek Drilling LP (TASE: DEDR.L) and Noble Energy Inc. (NYSE: NBL) to sell their stakes in the fields. The Greek company has since signed deals to sell gas to Israeli companies at around $4 per Btu (British thermal unit), 33% less than the $6 per Btu that Israel Electric Corporation (IEC) (TASE: ELEC.B22) is paying for gas from Tamar.

Gas is due to start flowing from the Tanin and Karish fields in 2021.

Energean's share price ended its first day of trading on Friday down 3.7%.

Published by Globes [online], Israel business news - www.globes-online.com - on March 18, 2018

© Copyright of Globes Publisher Itonut (1983) Ltd. 2018

Mathios Rigas Photo: PR
Mathios Rigas Photo: PR
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