Six contenders declare bids on Ashdod Bazan

The date for submitting price offers is expected to be set in the first half of the year.

February 16, 2006 22:30
1 minute read.

Six contenders declared their intention to bid on the Ashdod facility of Oil Refineries Ltd. (Bazan) to the Government Companies Authority before the deadline Thursday evening, the Finance Ministry said. Paz Oil Company Ltd., Delek Petroleum Ltd., Dor-Alon Energy Israel Ltd., Sonol Israel Ltd., Ampal Fuels Ltd., and Bianca Oil Refining Ltd. (an organ of Russian oil company Rosneft) all submitted an initial bank collateral deposit with the GCA in the amount of NIS 10 million, each alongside a detailed questionnaire on their financial condition, ownership structure and holdings. The bid declaration process had begun on Sunday. "The Government Companies Authority is pleased by the interest shown in the [privatization] procedure by the central actors in the fuel market," said GCA Director Eyal Gabbai. "The privatization of the Ashdod refinery is a significant milestone, and is reaching advanced stages of execution following years of trying to do so," he said. The GCA is currently handling the contenders' requests in order to begin the sale procedure "efficiently and quickly," Gabbai said. Following initial handling, the companies will receive information about the Ashdod refinery so they can complete the due diligence process. The date for submitting price offers is expected to be set in the first half of the year, the ministry said. The sale of the Ashdod refinery is taking place in accordance with a December 2004 decision by an inter-ministerial committee on privatization and a December 28, 2005 decision by the High Court of Justice to strike down an appeal by the Movement for Quality Government. The MQG had accused the government of illegally paying the Israel Corporation for the refineries, state property which the company had been operating at a profit as a concessionaire. Following the court's clearance, the state paid NIS 677.5m. for the 26% stake held by Israel Corp., paving way for the sale. The privatization scheme chosen by the state seeks to divide Oil Refineries Ltd. into its two composite facilities - Ashdod and Haifa - then sell the Ashdod refinery in a tender and, finally, offer the stock of the Haifa refinery for public trading on the Tel Aviv Stock Exchange. The state could also sell the Haifa facility in a tender, barring the winner bidder in the Ashdod sale.

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