BlackRock in talks on Shikun & Binui investment
US investment giant BlackRock has been involved in talks with Israeli company Shikun & Binui Holdings Ltd. about an investment in its energy unit before its IPO on the Tel Aviv Stock Exchange (TASE), Trend reports with reference to Reuters.
A source close to the matter told "Globes" that the sides held negotiations about a $500 million investment including a $250 million capital injection into Shikun & Binui Energy for the allocation of new shares and the purchase of $250 million of existing shares from the parent company Shikun & Binui. The talks were unable to reach any binding agreement. BlackRock had been considering taking a 30% stake in Shikun & Binui Energy.
Shikun & Binui Energy is fully owned by Shikun & Binui, controlled by Nati Saidoff. The company has power stations operated through systems combining gas and the creation of renewable energy (thermo-solar and more) in Israel and the US, with combined capacity of 1.2 gigawatts.
Saidoff and Shikun & Binui chairman Tamir Cohen see Shikun & Binui Energy has a stable company, which can operate independently. Consequently, the company is working towards an initial public offering (IPO) on the TASE and has filed a preliminary draft prospectus.
Market sources expect the IPO to be held in the coming weeks at a company valuation of $1.3 billion - $1.4 billion, pre-money. This value does not include any possible $250 million in Shikun & Binui Energy by BlackRock, which would be at a 10-12% discount on the company's valuation in the IPO, which is being led by Barak Capital Underwriters.
Market sources believe that with the publication of the prospectus, the talks between BlackRock and Shikun & Binui could be resumed.