Northern Power Station of
Generation Capital
+ 3.91%
Base:89.6
opening:91.9
Tall:93.5
low:91.9
change:3,937,579
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and
Ref
+ 6.19%
Base:2,438
opening:2,550
Tall:2,658
low:2,550
change:1,270,176
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Communications and Infrastructure will receive financing of NIS 1.3 billion by a consortium of investors led by a bank
Mizrahi Bank
+ 2.26%
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. The financing will replace the existing senior debt at the stations, which stands at NIS 850 million.
The stations are held at equal rates between the infrastructure fund and the energy and elbow. The 20-year financing agreements are in the form of project financing with a consortium of banking corporations and local financial entities to provide financing under “limited-recourse” conditions.
The financing will be used to fully repay the loan provided to the northern stations by Generation Capital, which stands at about NIS 150 million, making certain current investments. In addition, another substantial return on investment will be given to the shareholders, which is expected to be used, among other things, for the purchase of the Ashkelon and Soreq power stations, and the rest will be used for distribution between the shareholders of Generation Capital and Rafek Communications and Infrastructure.
According to the investment fund, the capital received from the power plants will be used for other investments. The refinancing allows Rafek Communications and Infrastructure to continue making investments without increasing credit risk at the solo level.
It will be recalled that as part of Rafek and Genershin’s desire to grow, they want to purchase two power plants from Delek Israel in Soreq and Ashkelon, through a partnership to be established with other partners, for NIS 367 million and additional conditions precedent. In November 2020, the parties signed an addendum to the agreement in which it was agreed that an additional extension would be granted for the existence of the suspensive conditions until the end of the civil year, with an option to extend the time of obtaining the conditions to about 13 months. If the suspensive conditions are not completed, a gradual purchase will begin.
Rafak is engaged in the construction of power plants, and in trade and consulting. The company showed an increase in revenue to NIS 683 million in the first three quarters of 2020, compared with NIS 439 million in the corresponding period last year. The company also managed to increase its net profit to NIS 14 million in the first three quarters of the year, compared with NIS 10 million in the corresponding period.
The company states today in its press release that it has managed to flood value to investors following the improvement carried out at the northern stations in the past year. These included the signing of the amendment to the northern stations’ agreements for the purchase of natural gas, the volume of the new debt is significantly higher than the volume of the old debt, and in accordance with the ability of the northern stations to substantially increase the volume of return on investment.
In addition, Rafak signed a contract with a company
Energian
+ 1.76%
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Tall:3,076
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To purchase natural gas for all power plants operating in order to lower costs. In accordance with the updated agreements and the new agreements, starting with the start of the flow of natural gas from the “Shark” field, Energian will sell natural gas to LPG in an aggregate amount of between 1.1 and 1.3 BCM per year, for periods of between 6 and 15 years. $ 2.7 billion.
The transaction was accompanied by the Beta Finance consulting firm and Adv. Yotam, the refinancing and gas purchase transactions were accompanied by the Beta Finance consulting firm and Adv. Yotam Leshem from the law firm Tadmor Levy.
Erez Detective, CEO and Founders of Generation Capital: “Refinancing agreements at Northern Power Plants are another significant milestone in creating value for investors at Generation Capital. The significance of the agreements for generation is great, as it is a return on a significant portion of the investment we made in the northern stations after exactly two years of ownership of the stations and extensive improvement activity. The agreements actually allow for the completion of the purchase transaction of the coastal stations, in the amount of NIS 100 million, without the need for an additional capital injection from Generation, and at the same time, the repayment of Generation’s Mazner loan in the amount of NIS 150 million and another substantial repayment to shareholders. ” .
Roni Oren, CEO of Rafek Communications and Infrastructure: “We are pleased with the refinancing agreements, which will allow Rafek Communications and Infrastructure to continue to promote new investments that the company’s management has been working on in recent months. The refinancing is the result of the maturation of the northern stations that have reached the stage of generating electricity and steam. Following the start of production, the old loans and the Maznin loan were replaced, which reflected the risks of the project before the start-up and before the signing of the new gas agreements. Replacement of loans indicates the confidence of the financiers in the capabilities of the group. The last two moves we have made at the company lower the cost of fuel and the cost of financing and thus allow the flooding of the value of the northern stations for energy supply. In addition, the refinancing allows Rafak Communications and Infrastructure to continue making investments without increasing credit risk at the solo level. “