Nochi Dankner has become a partner of Tzachi Sultan in oil exploration. In early hours of this morning, Modiin Energy LP announced that Sultan, the controlling shareholder (95%) in Noya Oil, which controls (75%) oil and gas exploration partnership Modiin had entered into an agreement with IDB Development Corp. (TASE: IDBD), controlled by Nochi Dankner.
Under the agreement, Sultan will sell IDB Development half his stake in Noya (47.5% of the issued share capital) and will also sell half of his holdings in the participation units and warrants of the partnership. The company did not specify exactly how much Dankner will inject into Modiin, but stressed that it was "a consideration that in total is not a material sum for the company." Sultan is currently in the midst of a rights issue designed to remove the partnership's shares from the stock exchange watchlist. Modiin needs to raise NIS 8 million, and trading in the rights issue will begin Wednesday and end Thursday.
The price of participation units in Modiin rose 41% on the Tel Aviv Stock Exchange this morning.
IDB Development has also been given an option to buy half of any additional securities of the partnership purchased by Tzachi Sultan, until the date of completion of the agreement. The sale of the securities sold and additional securities (if purchased) is at the price Sultan paid for them.
An interesting point that emerges from the stock market announcement is that next week, Modiin may file an application for an oil exploration permit in the Mediterranean. In late October, Modiin acquired 15% of the "Tzurim" concession, which also includes the "Halamish" enclave, to search for oil in the Dead Sea area. In addition, the partnership has rights in the "Sarit" license off the coast of Ashdod. Talking to "Globes" earlier this month, Sultan said he had plans for other licenses in the Mediterranean, but refused to go into details.
Published by Globes [online], Israel business news - www.globes-online.com - on January 17, 2010
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