Shapir Engineering Attracts $27 Million Investment from Meitav Pension

Meitav Pension and Insurance is joining Migdal, Amitim, and Clal in investing approximately NIS 109.25 million (around $27 million) in Shapir Engineering's concession projects. This investment will secure Meitav an 11.5% stake in a partnership that consolidates Shapir's holdings in the Northern Highway 6, Highway 16, and the Fast Lane project. The deal values the partnership at approximately NIS 950 million.

This marks the third phase of Shapir's strategy to bring institutional investors into its mature concession assets. In May, Shapir sold a 38.5% stake to Migdal and Amitim for about NIS 366 million, followed by a July deal where Clal entities acquired an additional 20% for approximately NIS 190 million. Upon completion of all transactions, these four institutional bodies will collectively own 70% of the partnership, having invested a total of roughly NIS 665 million.

Shapir will retain a 30% stake and continue to manage the partnership as the general partner. This move is described as a capital recycling initiative, allowing Shapir to recoup invested capital from operational assets without divesting completely, freeing up funds for new projects. Shapir's business model spans the entire infrastructure value chain, from initiation and construction to operation and maintenance.

The concession assets include toll roads like Northern Highway 6 (operational since 2019, concession until 2049), Highway 16 (operational since 2022, concession until 2044), and the Fast Lane on Highway 1 (operational since 2011, concession until 2036). These are long-term projects with stable, long-term cash flow potential, attractive to institutional investors due to government safety nets and inflation-linked adjustments.

Moshiko Saboski, CFO of Shapir Engineering, stated the move allows for capital recycling while retaining management and long-term benefits, freeing resources for growth. Nir Turner, Head of Infrastructure at Meitav Pension, noted the investment offers Meitav's clients stable, long-term returns backed by government guarantees and indexation.

The deal's completion is contingent on various conditions, including approvals from project clients, financiers, the Competition Authority, and the Tax Authority.