Jan 4 2010
Ampal-American Israel Corporation has exercised an existing option to convert its existing loan of $22.249 million to acquire a 25% equity stake in a sugarcane ethanol production project that is being developed by Merhav in Colombia. The option exercise agreement was signed between Ampal and Merhav (M.N.F) Ltd. The conversion of the loan and acquisition of the stake is subject to Banco do Brasil’s initial disbursement of a loan. Banco do Brasil is the financer for the project.
The sugarcane ethanol production project is being developed on approximately 10,000 hectares of land that includes industrial as well as agricultural sectors. The project has received all permits required including free trade zone approval and environmental licenses.
Commercial production of ethanol will begin in the year 2012 and the facility will attain its full production capability of 112 million liters per annum in 2014. Environmental legislation in Colombia requires that gasoline distributed in the country should be blended with 10% of ethanol and the project derives benefit from the legislation.
Yosef A. Maiman, Chairman, President and CEO of Ampal, said that the acquisition is in line with the company’s clean energy strategy and expands its portfolio, which includes investments in Global Wind Energy and EMG. Global Wind Energy develops wind farms outside Israel and EMG supplies natural gas from Egypt to Israel. He further added that the project combines the company’s clean energy investment strategy with Merhav’s ability to develop complex international projects. This facility is also Israeli’s largest project in Colombia that is supported by Israel’s leading technology, he added.
Merhav is fully owned by Yosef A. Maiman and the company has wide ranging interests including infrastructure projects, energy, and agriculture. A special committee of Ampal's Board of Directors has approved the transaction.
Source: www.ampal.com