Afcon Wins $7 Million Contract for New Electricity Substation

Afcon Holdings announced that its subsidiary, Afcon Control and Automation, has won a tender from the Israel Electric Corporation (IEC) to construct the Shahar Kochav Michael substation. The project is valued at approximately NIS 26.3 million (about $7 million USD).

Work is scheduled to commence on October 11, pending the finalization of the contract and the fulfillment of required guarantees and insurance. The project's payment is linked to the residential construction input price index.

This latest contract follows a series of recent wins and expansions for Afcon, particularly in the electricity, substation, and infrastructure sectors. Last week, the company secured additional work from Israel Railways worth about NIS 100 million for its transformer stations project, increasing the total project value from NIS 460 million to NIS 560 million.

Earlier, another Afcon subsidiary won a tender for a different substation valued at approximately NIS 36 million for a government company. Afcon is also expanding its involvement in data centers, having received NIS 49 million in early September for a data center project involving air conditioning for a facility with a capacity of approximately 40 megawatts of IT load.

Furthermore, Afcon was selected, along with other entities, to compete for the construction of substations under a government tender. The total scope for all bidders is estimated at NIS 690 million over the next two years, with an option for an additional two years and an increase to a total framework of NIS 1.38 billion. Afcon will compete for each substation individually within this framework.

Afcon's CFO, Ron Miller, previously highlighted substations and data centers as key growth areas, noting high demand from both the IEC and private entities, as any data center developer requires a substation. At that time, Afcon was simultaneously working on ten substations for various clients. Group CEO Dudi Reali also identified this sector as a growth engine, anticipating increased demand for power and transformer stations due to rising electricity consumption and the proliferation of server farms.