Delek Group Ltd. (TASE: DLEKG), controlled by Yitzhak Tshuva, has signed a memorandum of understanding for the sale of Delek Europe BV to British private equity fund TDR Capital LLP for €355 million (NIS 1.7 billion).
Delek Europe, run by chairman Ilan Shaffir and CEO Boaz Chechik operates in Benelux and France. It owns and operates 870 Texaco gas stations in Belgium and the Netherlands through Delek Benelux BV, and it owns and operates 401 BP brand gas stations, 356 convenience stores, and 235 car washes through Delek France BV. Delek Benelux is based on the 2006 acquisition of Chevron Corporation's (NYSE: CVX) operations in the Netherlands and Belgium, and Delek France is based on the 2010 acquisition of BP France SA.
TDR will pay €90 million when the deal is signed and €90 million plus 5% interest a year later. Delek will provide a seller's loan for the balance of €175 million, which will be repaid after five years, plus 5% annual interest. Delek will have a lien on Delek Europe shares as collateral for the loan.
Since the Tamar natural gas discovery in 2009, Delek Group has focused on its Israeli energy operations and sold other assets, including part of its stakes in Delek US Holdings Inc. (NYSE:DK) and Delek Automotive Systems Ltd. (TASE: DLEA), which it considers as financial holdings. On Wednesday, it sold the controlling interest in US insurer Republic Companies Group Inc.
"The company's strategy to focus on oil and gas exploration has been seen in the past two days. Yesterday, we sold 55% of Republic Companies Group and today we are close to closing the sale of Delek Europe for €355 million," said Delek Group CEO Asaf Barfeld. "Delek Europe has an external debt of €365 million, which gives the deal a value of €720 million. These two deals will greatly increase Delek Group's cash reserves."
Published by Globes [online], Israel business news - www.globes-online.com - on April 17, 2014
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