Following the exposure of BizPortal – Gil Agmon will issue Veridis at a value of NIS 3-4 billion – the capital market

Gil Agmon’s car fuel company in preparation for a major flood of value. We unveiled at the end of November the hidden value of car fuel and the real possibility of issuing Veridis (since the stock soared by 53%) and now the issuance process is stepping up. Veridis, which operates in the field of renewable energy and the environment, will issue on the stock exchange at a value of NIS 3-4 billion. Delek Car, which acquired control about three years ago at a value of about NIS 1.3 billion and holds 70% of Morridis, will gain significant accounting profit and a great flood of economic value.

This is no small matter, and it’s Agmon’s age who aspired to the move and the overflow of value (moves that upgraded him as one of the prominent people of the year for BizPortal surfers). Agmon decided three years ago to go big on energy and environmental activities. What about Agmon and the company under his control, Delek Automotive and the environment? Why invest NIS 1 billion in activities that have nothing to do with the main field of activity – importing vehicles? And not only is there no connection, but it even collides – polluting vehicles alongside the environment and clean energy? The market was not enthusiastic – the company’s stock lost height (50% in the year the deal was reported). There were concerns that the dispersion was not good for car fuel and the leverage could weigh on it. Three years later, Agmon can smile. Vehicle import activity is strong and kicking despite the corona and generates significant profits and cash flows And new energy and environmental activity has increased And doubled and even tripled its value.

From the explanation of Delek Car’s operating segments, it can be understood that the environment and energy sector brings in about NIS 220 million in a quarter, earning an operating profit of NIS 35-40 million. These results do not reflect significant growth compared to last year, although, over the last three years there has been significant growth (3 times the profits since the acquisition) and the field is expected to grow using the “stairs” method depending on the entry of additional projects. Veridis is expected to continue to enjoy the global trend of pushing for better solutions for the environment, and by virtue of being a prominent local player.

Operating profit of NIS 35-40 million, hot area, growing. Hype in the stock market around the field, do an account and you will get a company that can be worth conservatism (even over-conservatism) over NIS 3 billion.

Car fuel – from traditional operations to a holding company
Car Fuel Importer – Mazda, Ford and since 2011 is also an importer of BMW. The company’s many popular brands have strengthened its position as one of the largest car importers in Israel. This is an activity that generates an order of magnitude of NIS 200 million a year, but Agmon, which wanted to spread risks, identified two trends about three years ago – the first: changes in the automotive world, and the second: the development of environmental and renewable energy activities. The changes in the automotive world, the main ones being beyond electric vehicles, could hurt Delek Car’s profit centers – the activity itself will go down with the car manufacturers it imports, lag behind in the field and beyond that – the importer’s garages will be severely damaged. Electric vehicles are supposed to have fewer breakdowns. A major part of the car fuel profit comes from the envelope, that is, not from the sale itself, but from the care, repairs, etc.

Agmon caught two birds with one stone. The investment in Boridis expresses its assessment that the field of the environment will flourish and it also actually dilutes the impact of the field of vehicle imports. Beyond that, despite the big move – an investment of one billion shekels, Agmon made a correct risk diversification and was based on a cash cow that will also yield less, is still one of the largest cash producers on the stock exchange. The debt for the transaction (and by the way also the debt for its original purchase in 2010) was financed from the phenomenal profits and flows of the business activity – the sale of vehicles. The company distributes significant dividends, distributing over NIS 2 billion in the last ten years.

Who is Veridis?
Veridis operates in three areas: waste – collection and treatment of solid waste as well as collection and treatment of waste of hazardous materials. In addition, this division operates in the sorting of this waste and has shut down or at least its part for the production of fertilizers and energy.

The second area is the water area. Through this division, the company operates the desalination plant in Ashkelon and also treats sewage and landfills.

The third field in which the company operates is the field of energy. Through this division, Veridis owns 20% of the Rotem power plant together with OPC (Veridis owns 20% of the station), and also owns the IPP power plant in Ashkelon and the Afa gas station.