Oil Refineries board approves acquisition of 50% stake in Carmel Olefins

26-Jun-08

The board of directors of Oil Refineries' has approved a deal to buy a 50% stake (516 mln shares) in Carmel Olefins currently held by Israel Petrochemical Enterprises. The deal will be done through a stock swap. Oil Refineries (also known as Bazan) will the shares to Petrochemicals, comprising 20.5% of Oil Refineries' stock after the allocation. Oil Refineries will also sell 3.7 mln Petrochemicals shares back to Petrochemicals for US$40 mln. The deal between Oil Refineries and Petrochemicals closes a circle. Ilan Ben-Dov's company Suny will buy a 50% controlling interest in Scailex (the remains of Scitex) from Petrochemicals. Scailex owns 15.76% of Oil Refineries, through its subsidiary PCH. Those shares will pass to Petrochemicals, leaving Suny with Scailex minus its Oil Refineries shares. Scailex will then consist of nothing but a stock market shell except for a giant kitty with NIS 430 million, plus whatever it gets for selling the Oil Refineries shares. After all this, Suny will own 86% of Scailex and Petrochemicals will own all of PCH. PCH will own 15.76% of Oil Refineries and Oil Refineries will own all of Carmel Olefins. The Israel Corporation does and will own 45% of Oil Refineries