The controlling owner of Arkia, Arkia Airways Holdings and Aviation Services Ltd., entered into an agreement with Kenzon Israel Ltd., a public company traded on the Tel Aviv Stock Exchange, to merge Arkia or alternatively the holding company, in a transaction with Kenzon or a related company, to create a public company Another containing the Arkia activity, the shares of which are listed for trading on the Tel Aviv Stock Exchange.
In the event of a merger of Arkia into a related company, Arkia’s shareholders will receive 82.46% of the issued share capital of the receiving public company with NIS 10 million in its coffers and it will be free of any debt or liability.
The merger transaction depends on a number of conditions precedent, including entering into a binding agreement, completing due diligence, obtaining regulatory and other approvals, obtaining approval from the companies’ organs and raising at least NIS 30 million from various investors in a public or private offering at the same time completing the merger transaction.
In recent years, Arkia has enjoyed a significant increase in passenger traffic and has replaced the entire fleet of turbo props with new jets, including the Embraer 195 and the Airbus 321 NEO. In the past year, Arkia has carried out significant streamlining procedures in which the collective agreements have been updated, the number of employees has been reduced and at the same time the procurement conditions and computer systems have been improved and the company is ready for the expected aviation activities.
Avi Hurmero, CEO of the Gordash Israel Group, which controls Arkia Holdings, said“Nakash Group has owned Arkia for 15 years during which it worked for the company’s growth and prosperity. Now, Nakash Group has identified an opportunity to increase and further support Arkia’s operations, through a merger with the receiving public company. In cooperation with dedicated Arkia employees. “
Gadi Tepper, Chairman and CEO of Arkia, said: “With the changes taking place in the aviation industry, this is the right time to make a merger move that will march the company towards a solid future, injecting more capital into Arkia will allow the company to increase its fleet while effectively taking advantage of the aviation and tourism market opportunity. With the company’s employees who have contributed a lot, we will continue to lead the company to growth and success. “
Portofino Investments Ltd. is the investment banker in the transaction. Adv. Ronen Kantor and Dr. Shlomo Ness, partners from the firm of Doron Tikotsky Kantor Gutman Ness and Amit Gross, lawyers, accompany Arkia as part of its moves in the capital market and in general.
The merger deal is expected to be completed in the coming months