Ampal-American Israel Corporation (NASDAQ: AMPL) (TASE: AMPL) announced today that its indirect wholly owned subsidiary Merhav-Ampal Energy Ltd. ("Merhav-Ampal") entered today into a definitive share purchase agreement to sell all of the outstanding shares of 012 Smile Telecom Ltd. ("012 Smile"), a wholly owned subsidiary of Merhav-Ampal, to Partner Communications Company Ltd. (NASDAQ: PTNR) for a purchase price of approximately 692 million New Israeli Shekels ("NIS"), or $191 million, of which approximately NIS 42 million, or $11.6 million, are to be paid by way of 012 Smile assigning payments due from a third party. As part of the transaction, Partner has also agreed to assume approximately NIS 800 million, or $221.6 million, of long-term debt, which brings the total transaction value to a total of approximately NIS 1.492 billion, or $412 million.
The transaction, which is expected to close in 2-3 months, is subject to customary closing conditions, including the regulatory approvals of the Israeli Ministry of Communications and the Israeli Antitrust Commissioner. However, it is not subject to a financing condition.
As a result of the sale, Ampal expects to record a gain before tax of approximately 310.2 Million NIS, or approximately $85.7 Million.
Commenting on the sale, Mr. Yosef A. Maiman, Chairman, President and Chief Executive Officer of Ampal, said: "012 is one of the major pillars of the Israeli telecommunication market, with a strong business which provides a steady cash flow and holds many diverse growth opportunities. Nevertheless, the sale of 012, at a substantial gain to Ampal, is undoubtedly beneficial both to Ampal and its shareholders. Through this transaction we were able to create, in a relatively short period of time, substantial value and cash flow which will further strengthen Ampal's balance sheet. This will allow Ampal to continue its own growth in the Chemical and Energy sectors and its explorations in other possible investment areas, all in accordance with Ampal's vision and goals."