Nofar Energy Prepares Israeli Operations for IPO with Major Investments

Nofar Energy is advancing its plan to separate its Israeli operations and prepare them for an initial public offering (IPO). The company announced that Clal Insurance has completed the second and final stage of its investment in Nofar Israel, injecting an additional NIS 102 million. Clal's total investment amounts to NIS 308 million for an 18.75% stake in the subsidiary, a move finalized ahead of schedule. The original agreement stipulated the second stage would conclude by October 31, but with necessary approvals secured, the deal is now fully closed.

Initially, the agreement with Clal, signed at the beginning of the year, valued Nofar Israel at approximately NIS 1.6 billion post-money. The final investment of NIS 308 million for 18.75% implies a valuation of about NIS 1.64 billion. Nofar Israel had previously raised NIS 300 million from Clal at a NIS 1.6 billion valuation, with plans for an IPO within two years, positioning Nofar Israel as a more independent entity.

Nofar has also secured a non-binding memorandum of understanding with Meitav Investment House, which plans to invest NIS 200 million for an 8.7% stake. This deal reflects a valuation of approximately NIS 2.1 billion pre-money, or NIS 2.3 billion post-money, a roughly 40% increase from the Clal deal. The Meitav transaction is in its final stages of closing.

These investments are crucial for Nofar Israel, which consolidates the company's domestic renewable energy, storage, conventional power generation, and electricity trading activities. Nofar Israel boasts a portfolio of approximately 12.3 gigawatts, with a portion connected to the grid and more under development. The company has also recently expanded its operations, acquiring stakes in the 865-900 megawatt Rendir gas-fired power plant and the Hylight solar and storage projects.

Ofer Yanai, CEO of Nofar Energy, stated that the investments from Clal and the pending deal with Meitav demonstrate strong institutional support, providing capital for Nofar Israel's accelerated growth and strategic acquisitions. Despite a net loss of NIS 60 million in the first half of the year, Nofar Energy returned to profitability in the second quarter with a net profit of NIS 16 million, driven by increased revenues from electricity generation, partly due to new projects in the US and Europe. High financing expenses remain a challenge, but the company's asset base is growing, with projected revenues and EBITDA expected to significantly increase by 2029.