International investment company Oaktree Capital Management announced today that it had completed its first deal in Israel: the acquisition of Veolia Environment's Israeli activity in conjunction with Veolia's local management, led by Veolia Israel founder and chairman Uri Starkman. The parties announced their intention to contract an agreement as early as July 2014. Now, eight months later, they have obtained all the regulatory authorizations and successfully completed due diligence, and the negotiations between them have produced a binding agreement. A banking consortium led by Bank Hapoalim (TASE: POLI) is financing the deal.
Oaktree is constantly looking for opportunities for more deals in Israel, and hopes that its efforts will yield results, enabling it to increase its investments and gain a foothold in the Israeli market.
Veolia has operated successfully in Israel for over 20 years. Veolia Israel is considered a pioneer in environmental business and infrastructure. Among other things, it built Israel's first desalinization plant (in Ashkelon), and was a partner in the building the OPC Mishor Rotem power plant, Israel's largest private power plant. The local company also built the Jerusalem light rail, Israel's first and only light rail project to date, in addition to its large-scale business in managing the garbage sector. Veolia Israel plans to continue its development of the three main sectors of its activities, as well as promoting innovative solutions in land purification, production of energy from garbage, and efficient energy systems.
The positive growth rate in the Israeli economy is generating a growing demand for better infrastructure in water, energy, and especially garbage. Veolia Israel's profound knowledge in these sectors in general, including the needs of the Israeli market; the quality of its management; its proven capabilities in complex environmental projects; combined with Oaktree's international professional expertise, are expected to make Veolia Israel an even more significant infrastructure player in Israel.
Starkman says, "During Veolia's 20 years of successful business in Israel, we have brought about a real and positive environmental change in Israel. In order to substantially expand business in the coming years, we have initiated the recruitment of a world-class investor. We're proud of our new partner, Oaktree, whose entry into Israel is wonderful news for the Israeli economy. We'll continue to improve the environment in Israel"
Oaktree managing director Oren Peleg said, "The deal with Veolia Israel is a harbinger of Oaktree investments in Israel. We're excited that our first acquisition is the acquisition of a company that is one of the leaders in Israel and worldwide in the environment, energy, garbage, and water, and we believe that thanks to our capabilities and global experience, we'll be able to improve Veolia Israel and move it forward to additional successes." Peleg added, "The fruitful cooperation with the major banks in Israel is strategically important for Oaktree in advance of its next investments in the Israeli market."
Published by Globes [online], Israel business news - www.globes-online.com - on April 1, 2015
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