Yitzhak Tshuva agrees to sell 70% of stake in Delek Israel
Delek has suffered amid the coronavirus pandemic, seeing shares fall as deep as 87% over the year.
By ZACHARY KEYSERFlag of the Delek Group(photo credit: Wikimedia Commons)
Israel's wealthiest citizen, billionaire Yitzhak Tshuva, will be selling 70% of his shares in Delek Israel after agreeing to part ways with his majority stake for the tune of NIS 750 million, according to Israel Hayom.Delek Israel is one of the main assets of the indebted Delek Group Ltd, controlled by Tshuva. Delek operates one of Israel's largest chain of gas stations with 239 gas station, of which 178 are independently operated, as well as 196 convenience stores.Tshuva will be selling the shares to Lahav LR Real Estate's Avi Levy, Eli Lahav, Ilik Rozensky and Uri Mantzur, after Rami Levy, who owns Israel's third-largest supermarket chain bearing his namesake, backed out of negotiations.Levy was apparently receiving push back from the religious sector over the prospective sale, who told the owner that if he bought the company – which operates on Shabbat – that he would face a consumer boycott against his marquee supermarket businesses, sources told Israel Hayom.Levy may still choose to join the deal, however, as there is a contract option to secure and additional 3.5% of Delek Israel stock over the next four months.Delek has suffered amid the coronavirus pandemic, seeing shares fall as deep as 87% over the year.Delek, which has stakes in Israel's two largest offshore natural gas fields, said quarterly revenue in the local market net of royalties rose 64% to NIS 498 million ($148 million), mainly due to gas production starting from the Leviathan field.Delek said it posted a quarterly loss of NIS 326 million , mainly due to one-time accounting provisions, compared with a 190 million shekel profit a year earlier.Revenue slipped to NIS 1.94 billion from NIS 1.96 billion as a rise in revenue from the sale of gas and oil in Israel and in the North Sea was offset by lower revenue from fuel distribution and marketing operations in Israel due to the COVID-19 pandemic.The sale will allow Delek to repay its debts back to the banks, which totals nearly NIS 350 million at the moment. It will also allow Delek Drilling to break off from Delek Israel, which currently holds a lien on the energy exploration project.
To stave off the banks, Tshuva already put forth NIS 3 billion in assets and raised an addition NIS 313 million since the onset of the coronavirus pandemic.According to Israel Hayom, Delek Israel stands to earn NIS 630 million through the deal.Reuters contributed to this report.
